The U.S. Securities and Exchange Commission (SEC) has admitted to making inaccurate statements in an ongoing case against cryptocurrency firm Debt BOX. The SEC alleges that Debt BOX defrauded investors of almost $50 million. However, the SEC admitted that its legal counsel made inaccurate representations during a hearing in July, which allowed the SEC to obtain a restraining order and other restrictions against Debt BOX. The SEC acknowledged failings within its organization and expressed regret for the errors. It promised to prevent similar mistakes in the future and has assigned senior staff and an experienced attorney to the case. Gurbir S. Grewal, the SEC’s Director of the Division of Enforcement, also admitted to error and apologized for the shortfall. The SEC pleaded with the court not to apply sanctions, stating that their errors did not warrant a misconduct penalty.
One key error concerned the claim that 33 of Debt BOX’s bank accounts had been closed 48 hours before testimony. The SEC admitted that this claim was based on a misunderstanding between SEC counsel Michael Welsh and another SEC member. The regulator clarified that only 24 accounts were closed and none were closed in July 2023, as previously stated. The SEC also attempted to justify other errors regarding Debt BOX’s attempts to relocate assets, block regulators from viewing its social media, move business operations overseas, and drain certain bank accounts. While the SEC maintains certain facts, it admitted that many of Welsh’s inferences are not justified by those facts.
District Judge Robert Shelby, who presides over the case, reprimanded SEC attorneys and warned of possible sanctions. Another company, Terra Labs, attempted to use the SEC’s errors to dismiss its own case. The SEC’s admission of inaccurate statements raises questions about the credibility of its case against Debt BOX.
This News Article was automatically generated by Bob the Bot (AI)
| Information | Details |
|---|---|
| Geography | North America |
| Countries | |
| Sentiment | neutral |
| Relevance Score | 1 |
| People | Robert Shelby, Laurie Abbott, Michael Welsh, Gurbir S. Grewal |
| Companies | Terra Labs, U.S. Securities and Exchange Commission (SEC), Debt BOX |
| Currencies | None |
| Securities | None |
