US SEC historically secures $2.8 Mn in settlement
Crypto news: A US SEC lawsuit dating back to September 2022 against a crypto firm has finally ended in a $2.8 million settlement. The lawsuit in question accused Hydro Technology Corp. and its former CEO Michael Ross Kane for their roles in conducting the unregistered offerings and sales of crypto-securities called “Hydro”. In addition, they were alleged to have conducted a scheme to manipulate the trading volume and price of these securities, which generated more than $2 million for Hydrogen.
SEC decides big with hydrogen
On Thursday, a federal judge in New York approved a settlement agreement between the SEC and Miami-based Hydrogen Technology Corp. Co-founder and former CEO Michael Kane also agreed to end the legal dispute. In September, the regulator filed a lawsuit against two people, alleging that they had paid a third party to manipulate the trading of the company’s Hydro token to artificially increase its price. The day after the complaint was filed, the third party in question, Tyler Ostern, agreed to settle the case for $41,000.
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As part of the settlement, Hydrogen has agreed to pay a total of nearly $2.8 million, consisting of nearly $1.5 million in forfeited profits — which refers to the profits from illegal or wrongful conduct — a fine of more than $1 million, and prejudgment interest . Michael Kane, for his part, has agreed to pay a fine of approximately 260,000 dollars.
Strict conditions set for hydrogen
Both the company and Kane are bound by the terms of the settlement, which stipulates that they cannot confirm or deny the claims made against them. In addition, they will not be allowed to sell additional cryptocurrencies unless they have passed a Howey test and received SEC approval. However, Kane will still be able to engage in the wider crypto market, where he can continue to trade cryptocurrencies for himself.
According to the complaint filed by the SEC, Michael Kane, who also controlled Hedgeable Inc – an SEC-registered investment adviser – needed to raise new capital, which led to the formation of Hydrogen in the top market in December 2017. In January 2018, Hydrogen minted more than 11 billion Hydro tokens that were distributed through gifts to its employees, retail investors and to those who promoted the project as a reward.
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