A United States judge has granted a motion from the US attorney’s office to halt the SEC’s action against Edit Pardo and Boaz Manor for their involvement in the alleged $30 million crypto scam CG Blockchain. The US District Judge Stanley Chesler cited a parallel pending criminal investigation against Pardo and Manor in granting the motion to stay the SEC’s action, reasoning that halting the suit until the conclusion of the criminal proceedings “would best serve the interests of justice”.
Manor and Pardo have been charged with the five counts of frauds.
Manor and Pardo, who both are Canadian citizens, have been charged with one count of securities fraud, one count of conspiring to commit wire fraud, and three counts of wire fraud. The prosecution argued in favour of the stay to prevent alleged crypto scam operators from obtaining material through civil discovery that would not otherwise be available to them under the narrow scope of criminal discovery, a sentiment echoed by the district judge. The defendants are accused of issuing fraudulent and unregistered securities called BCT tokens from August 2017 until September 2018 to hundreds of investors in the US and worldwide.
The US Supreme Court limits the amount of fines the SEC can impose on crypto firms.
The US Supreme Court ruled that the Securities Exchange Commission can not impose fines and disgorgement that exceed the profits made from illegal activities. The judgement also noted that the penalties can only be “awarded for the benefit of victims”, not imposed as punitive damages. The US SEC over the last few years has been imposing hefty fines and penalties against crypto firms who held illegal ICOs. The ruling by the Supreme Court has limited the amount of fines that the Securities Exchange Commission can impose.