Former AriseBank Execs Settle Charges in SEC ICO Fraud Lawsuit

The SEC has settled charges with AriseBank's former CEO and COO, requiring the two to pay $2.7 million in disgorgement and $187,000 in penalties.

AccessTimeIconDec 12, 2018 at 9:45 p.m. UTC
Updated Sep 13, 2021 at 8:40 a.m. UTC

The U.S. Securities and Exchange Commission (SEC) has settled charges with two former executives of AriseBank, which was hit with a token sale fraud lawsuit in early 2018.

Former AriseBank CEO Jared Rice Sr. and former COO Stanley Ford will pay a combined $2.7 million in disgorgement and penalties, as well as $187,767 each in penalties. While neither admitted or denied the charges, both have also agreed to lifetime bans from serving as officers or directors of public companies and from participating in digital securities offerings.

Specifically, the two will pay $2.26 million in disgorgement and $68,423 in prejudgement interest.

Moreover, both are permanently prohibited from violating antifraud and registration provisions of federal securities laws.

AriseBank's ICO was halted by the SEC in January of this year, which sued the company and the individuals behind it for allegedly committing fraud.

The Texas Department of Banking issued a separate cease-and-desist order against the company a day earlier, noting that the company was not authorized to provide banking services in the state, where it was based.

Rice was arrested late last month by the FBI after being indicted on separate criminal charges of securities and wire fraud. He allegedly lied to investors about AriseBank's authorizations, claiming the "first decentralized banking platform" could offer Federal Deposit Insurance Corporation (FDIC)-insured bank accounts, credit and debit cards through Visa and other services.

However, the platform reportedly has no relationship with the FDIC or Visa.

SEC image via Shutterstock


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

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.