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Returning in September, California FPTD and other U.S. regulatory agencies have ordered Nexo to no longer offer products of interest, that, in the case of the corporation, took the form of cryptoasset loan accounts.
At the time the charges were filed, Nexo had already ceased offering the accounts to U.S. investors.
However, US investors would still be able to use the feature by opting for automatic renewal of existing accounts.
Cooperation with the administration.
Four months later, the SEC and the North American Securities Administrators Association (NASAA) announced that they had terminated their legal proceedings against the lender. Following the inquiry, nexo voluntarily agreed to pay fines of $45 million.
The crypto platform refused to confirm or deny the regulators’ findings – nevertheless, a spokesman for the SEC stated that the penalties imposed on the firm took into account Nexo’s cooperation and willingness to engage with regulators without constraint.
In addition, the Chairman of the Board, Gary Gensler, stated that nexo was not charged for operating an EIP, but for not properly registering it.
We have accused nexo of not registering its retail crypto loan product prior to offering it to the public, circumventing the essential disclosure requirements to protect investors. Respect our tried and true public policies is not an option. When crypto companies fail to comply, we will continue to monitor the facts and the law to hold them to account. In this case, among other measures, Nexo terminates its non-registered loan proceeds as it does for all American investors."
Multiple fines distributed among regulatory agencies.
Penalties of $45 million will be paid to several entities as part of a minimum of 18 separate fines. The most important represent half of the total amount and will be paid directly to the sector.
The remaining $22.5 million will go to a minimum of 17 government securities regulators under the coordination of the nasaa. The exact states are not named; however, we can assume that California is one of them, because of their early participation in the matter.
The deal was also confirmed by nexo in a nine-part twitter feed.
Nexo entered into a historic agreement with the United States Securities and Exchange Commission (sec), the North American Securities Administrators Association (nasaa), which includes the 50 U.S. states.https://t.co/modjbPsOdV
— Nexo (@Nexo) January 19, 2023
In the feed, Nexo again said there were no allegations of fraud or anything other than an unregistered securities offer. The spokesperson also reiterated that the company is pleased to have engaged in constructive dialogue with the authorities and that they will continue to grow and improve based on the feedback they received.
