Business

Steve Kaaru

Veritaseum ICO organizer in settlement talks with SEC

The U.S. Securities and Exchanges Commission (SEC) is reportedly engaged in settlement talks with Reginald Middleton, the man behind Veritaseum. The regulator has been settling with several other blockchain companies and according to a report by Finance Feed, Middleton is the latest one. The SEC had accused Middleton of organizing a fraudulent ICO which raised close to $15 million.

Earlier this month, the SEC filed a motion to adjourn at the New York Eastern District Court, the report states. In its filing, the SEC explained that it had been engaged in settlement talks with Middleton. Following the motion, Magistrate Judge Ramon Reyes agreed to reschedule the initial conference for November 11.

The regulator has been pursuing Middleton and his two companies for allegedly raising $14.8 in illegal securities sale. As CoinGeek reported in August, the SEC filed an emergency action against him and his company, Veritaseum Inc., seeking to stop them from using any more of the funds raised.

At the time, the SEC accused Middleton of misleading his investors to believe that he had developed a product that would generate them millions of dollars. Moreover, he manipulated the price of the VERI tokens to entice more investment, before ultimately dumping them.

Middleton additionally misappropriated at least $550,000 of the money raised in the ICO for his own personal use, the SEC claimed.

On his part, Middleton pushed back against the SEC, publishing court documents in August that purportedly supported his view that the SEC should unfreeze his assets. Part of the documents stated, “The temporary freeze in this case has already caused significant harm to the holders of Veritaseum’s utility tokens, the very people the SEC is purportedly seeking to protect.”

Middleton also pointed out that by freezing Veritaseum’s assets, the regulator was denying the company the opportunity to engage in activities that could ultimately benefit the holders of the VERI tokens.

It seems like the debacle is finally coming to an end with the settlement. While the details are yet to be made public, it’s likely going to be a reasonable settlement, following in the path of recent such actions. The regulator has recently settled with several companies in the blockchain industry including Block.one, Nebulous and Fantasy Market.

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