On February 14, US District Court for the Southern District of California issued a temporary ban on Blockvest LLC operations charging fraud connected with a securities offering. As a result, the court actually revised its previous decision made in late 2018.
According to the released document, the SEC filed a lawsuit on October 3 2018, in which the regulator noted that the respondents had plans to raise funds via the ICO for several financial products that could bring "passive income" and promised huge profits. Moreover, the company stated during the campaign that they had got the green light from the regulator, though in fact there was no approval received.
"The defendants used the SEC seal without permission and falsely claimed that their crypto fund was "licensed and regulated", the SEC notification reads.
However, the court rejected the claim last November, citing not enough evidence that the BLV token was security in line with the US legislation.
The founder of the company Reginald Buddy Ringgold is also accused of promoting ICO with the help of a non-existent regulatory entity Blockchain Exchange Commission which used a seal resembling the SEC one and marked the SEC head office as its own.
As a result, the court prohibited the defendants to perform any activities involving the fraudulent offering or sale of securities, violating federal securities laws.
The court concluded that Blockvest company offered unregistered securities and thus it "violated Section 17(a) [of the Securities Act of 1933]."