No Disney, No PayPal? SEC Charges ICO Founder Over False Statements

The U.S. Securities and Exchange Commission has charged the company behind an initial coin offering (ICO) and its president with securities fraud.

May 29, 2018 at 8:32 p.m. UTC
Updated Sep 13, 2021 at 8:00 a.m. UTC

The U.S. Securities and Exchange Commission (SEC) has charged a company and its president with securities fraud in connection with their efforts to raise funding via an initial coin offering (ICO).

Michael Stollery, also known as Michael Stollaire, has been accused alongside his firm Titanium Blockchain Infrastructure Services with violating the SEC's antifraud and registration provisions in connection with a multi-million dollar token sale. The agency accused Stollaire of fabricating information in claims that Titanium had relationships with companies like PayPal and Disney.

Officials with the U.S. securities regulator obtained an emergency asset freeze and the appointment of a receiver in relation to the token sale, which raised as much as $21 million, according to the SEC.

The focus on alleged misrepresentation echoes similar actions by the agency to combat fraud related to the use case, given that the SEC has accused Centra and its three co-founders of lying about their relationship with card network operators Visa and Mastercard.

Robert Cohen, the head of the SEC Enforcement Division's Cyber Unit, said in a statement:

"This ICO was based on a social media marketing blitz that allegedly deceived investors with purely fictional claims of business prospects. Having filed multiple cases involving allegedly fraudulent ICOs, we again encourage investors to be especially cautious when considering these as investments."

According to statements, the complaint against Stollaire and Titanium was initially filed on May 22. Another company tied to Stollaire, EHI Internetwork and Systems Management Inc., was also named in the complaint.

Image via Shutterstock

The Festival for the Decentralized World
Thursday - Sunday, June 9-12, 2022
Austin, Texas
Save a Seat Now

DISCLOSURE

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.

Trending

1
CoinDesk - Unknown
Jae Kwon Returns to ‘NewTendermint’ to Battle for the Soul of Cosmos

Ignite, which rebranded from Tendermint in February, will split into two entities: Ignite and NewTendermint.

Ignite, which rebranded from Tendermint in February, will split into two entities: Ignite and NewTendermint.

CoinDesk - Unknown
2
CoinDesk - Unknown
Crypto Whales Ditched Tether for USDC After Stablecoin Panic

The UST failure prompted large investors on the Ethereum blockchain to leave USDT for the perceived safety of its biggest competitor.

The UST failure prompted large investors on the Ethereum blockchain to leave USDT for the perceived safety of its biggest competitor.

CoinDesk - Unknown
3
CoinDesk - Unknown
FTX’s Bankman-Fried Pitches CFTC on Directly Clearing Customers’ Crypto Swaps

The crypto exchange’s founder and CEO made his case at a Washington D.C. roundtable, while mainstream derivatives firms painted his ideas as dangerous.

The crypto exchange’s founder and CEO made his case at a Washington D.C. roundtable, while mainstream derivatives firms painted his ideas as dangerous.

CoinDesk - Unknown
4
CoinDesk - Unknown
Terra lanzaría su snapshot esta semana: cómo serán distribuidos los 'nuevos' LUNA

El suministro de tokens en la nueva blockchain será de poco más de $116 millones, dijeron los desarrolladores.

El suministro de tokens en la nueva blockchain será de poco más de $116 millones, dijeron los desarrolladores.

CoinDesk - Unknown