U.S. Securities and Exchange Commission (SEC) and the State of New York allege that Coinseed defrauded investors of $1 million through concocted statements, hidden fees and worthless tokens.
New York's attorney general Letitia James filed a lawsuit on Wednesday to shut down the cryptocurrency platform Coinseed Inc. for allegedly defrauding investors of more than $1 million
As per the U.S. Securities and Exchange Commission the aforementioned tokens were sold from December 2017 to May 2018.
The attorney general said Coinseed had claimed the CSD token as "a great opportunity for young people who want to make money in the crypto market," and that the mobile app was "guaranteed" to help push its market value higher.
Davaasambuu also said Coinseed left New York in 2019 and has not accepted users from the state since 2018.
According to Davaasambuu, Coinseed didn't allow any US investors to participate in its ICO, hasn't received any complaints from investors, and has paid out dividends to coin holders since 2018.
He also claimed that no cryptocurrency exchange has licensed commodities broker-dealers, and that "they're trying to make us an example" to force all cryptocurrency firms to have licensed brokers. He also denied the allegation that Coinseed charged extra fees.
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