The United States Securities and Exchanges Commission (SEC) said in a May 14 notice that it had fined Canada-based blockchain entrepreneur, Alex Tapscott, and his firm NextBlock Global the sum of $25,000.
According to the notice, the offense warranting the charges is that neither the Canadian company or its securities were registered with the U.S SEC even though its primary purpose was to pool public funds for investing in blockchain and digital asset companies.
Additionally, the SEC said the entrepreneur had made false representations regarding four prominent individuals it claimed was backing its token offering that took place in 2017.
Regarding the misleading information which aided the realization of $16 million from both Canadian and U.S investors, the notice disclosed,
“These misrepresentations were part of the selling point of NextBlock’s fundraising effort: that NextBlock and Tapscott had access to, and unparalleled relationships with [...] highest-profile figures in the blockchain community. NextBlock and Tapscott knew or should have known that the statements to investors regarding these advisors were inaccurate.”
Meanwhile, the SEC said in its announcement that it accepted the $25,000 fine for Tapscott after it discovered that the founder promptly did remedial acts after the offense was brought to its notice. The project refunded investors.
Also, the U.S regulators took into consideration the fact that the Ontario Securities Commission (OSC), the regulatory body presiding over NextBlock’s office location imposed a $520,000 civil penalty for the same offense.
Even the founder, Alex Tapscott, was also fined $148,000 by the OSC and asked to lead efforts to teach three Canadian business schools about ethics. In total, that would mean a fine of $693,000 paid for breaching securities laws in both the U.S and Canada.
In November, Stmarket.co reported that the U.S SEC fined EtherDelta’s co-founder Zachary Coburn the sum of $388,000 for another offense relating to the breach of securities laws.