The two companies are Bermuda-based Arbitrade Ltd and Canada-based Cryptobontix with directors Troy RJ Hogg, James L. Goldberg, Stephen L. Braverman and Max W. Barber, founder and sole owner of SION Trading. SION is designated as the sole defendant in the case.
“Although this case involves crypto assets, it bears the hallmarks of a classic Pump-and-Dump scheme.”
The securities watchdog explained that between May 2018 and January 2019, the two companies, through the four defendants, “issued notices falsely claiming that Arbitrade had acquired and received ownership of up to $10 billion in bullion.”
They further stated that “the company intends to support each DIG token issued and sold to investors for $1, and that independent accounting firms have performed a “gold” audit and verified its authenticity. its existence”.
However, in reality, SEC claims the gold buyback is a ploy to boost demand for DIG, allowing holding companies to sell at least $36.8 million in DIG, including to US investors.
The SEC charged the defendants with violating the anti-fraud and securities registration provisions of the federal securities laws.
The SEC "seeks remedial action, grievances plus additional monetary and most severe civil sanctions."