SEC Sues Unicoin, Executives Over $100M Fraud Claims
Action marks SEC's first major enforcement under new leadership
Welcome to the Wednesday edition of the Crypto In America newsletter!
What you’ll read: The SEC flexes its enforcement muscle with new action against Unicoin, Senators prepare for a rigorous amendment process on the GENIUS Act, and the Crypto In America team talks fighting on-chain crime with TRM Labs’ Ari Redbord.
The Securities and Exchange Commission has filed charges against Unicoin and three of its executives for allegedly defrauding investors in a high-profile crypto offering, marking the agency’s first major enforcement action under new leadership and signaling a continued determination to crack down on alleged fraud in the digital asset space.
In a complaint filed Monday night in the Southern District of New York, the Commission accuses Unicoin of falsely claiming that its tokens were backed by billions of dollars in real estate and equity holdings. The company is also alleged to have overstated sales figures and misrepresented its offerings as SEC-compliant. Named as defendants in the lawsuit are Unicoin CEO Alex Konanykhin, board member Maria Silvina Moschini, and former Chief Investment Officer Alex Dominguez.
“We allege that Unicoin and its executives exploited thousands of investors with fictitious promises that its tokens, when issued, would be backed by real-world assets including an international portfolio of valuable real estate holdings,” said Mark Cave, associate director in the SEC’s Division of Enforcement. “But as we allege, the real estate assets were worth a mere fraction of what the company claimed.”
The lawsuit comes just days after Unicoin announced its intention to launch an initial coin offering next month through a non-U.S. affiliate.
“It’s lamentable that the SEC chose to persecute the most compliant cryptocurrency company in the country using blatantly false charges,” Konanykhin told Crypto In America on Wednesday morning, claiming Unicoin had already passed two prior SEC investigations “with flying colors.”
The Commission, led by Republican Chairman Paul Atkins, has signaled its intent to continue pursuing fraud cases, even as it scales back enforcement actions against high-profile crypto firms like Coinbase, Ripple, Kraken, and Consensys.
In an interview last month, Konanykhin said he fully intends to win the case in the courtroom.
GENIUS Act Clears First Hurdle — Now Comes the Amendment Gauntlet
Senators are scheduled to vote this morning at 11:30AM EST on the motion to proceed to formal debate on the GENIUS Act following a Monday procedural vote to advance the bill forward.
If the vote passes — which is likely, given renewed support from more than a dozen Democrats — it will kick off an arduous amendment process. Lawmakers on both sides of the aisle are already lining up proposed changes, ranging from crypto ethics provisions related to Trump’s family ventures to a Central Bank Digital Currency ban from Senator Ted Cruz (R-TX). Expect additional tweaks to anti-money laundering language as well.
Perhaps most notably, Sen. Roger Marshall (R-KS) has filed an amendment that would fold the entire text of the Credit Card Competition Act — co-authored with Sen. Dick Durbin (D-IL) — into the GENIUS Act. Originally introduced in 2023, the CCCA aims to bring more competition to the U.S. credit card market by requiring large banks to support at least two processing networks. The bill has repeatedly failed to pass on its own but is now being positioned as a legislative rider on the high-priority stablecoin bill.
Sen. Thom Tillis (R-NC) has already warned that attaching the CCCA would cost the bill his vote.
Meanwhile, the banking lobby group American Bankers Association is pushing back hard. ABA CEO Rob Nichols called the amendment a "poison pill," warning it would “rob consumers of their card rewards and leave them at greater risk of fraud.”
He urged crypto advocates to side with banks and oppose the effort.
Cracking Down on Crypto Crime with TRM Labs
In today’s episode of Crypto in America, the team sits down with Ari Redbord, Global Head of Policy at TRM Labs, at CoinDesk’s Consensus conference.
Ari shares his insights on the current state of crypto in the U.S., emphasizing the importance of regulation, compliance, and security in the digital asset space. The conversation also covers TRM Labs’ work in combating illicit activity, the push for regulatory clarity, and the evolving landscape of stablecoin legislation.
Catch it on all platforms here.
Remember, new editions of the Crypto In America newsletter drop every Monday, Wednesday and Friday at 7AM EST.
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Not sure. Why are the banks against this? The adoption of XRP and the utilization of ISO20022 technology is whats going to save them. Swift can no longer cut it. Trust me, the majority of banks have already signed up to use blockchain technology. The bill will pass and all the cry babies like Senator Warren are just gonna cry cause their fraud can no longer effect us anymore.
How about updating Tron case, been 60 days since the stay order, things should be heating up.