The post Abra hit with SEC charges for unregistered crypto sales appeared on BitcoinEthereumNews.com.

Abra, operating under Plutus Lending LLC, just got busted by America’s SEC for not playing by the rules with its crypto lending product, Abra Earn. The SEC hit Abra with settled charges for not registering its offer and sale of Abra Earn.  The SEC also says Abra was running as an unregistered investment company. Back in July 2020, Abra launched Abra Earn in the U.S., letting investors hand over their crypto in exchange for some pretty vague promises of a variable interest rate.  At its peak, Abra Earn managed to pull in around $600 million in assets. $500 million of that came from U.S. investors alone. Abra pitched this program as a way for folks to earn interest on their crypto “auto-magically.”  The SEC claims that Abra used these investor assets to make money for itself and pay out interest. This was all done without registering the product as a security. Apparently, they were issuing securities and holding more than 40% of their total assets, not counting cash, in investment securities. This included loans of crypto assets to big institutional players. Fast forward to June 2023, and Abra starts to realize the heat is on. They decided to wind down the Abra Earn program and told all their U.S. customers to get their crypto out. Smart move, but a little too late.  The SEC had already zeroed in. Stacy Bogert, the Associate Director of the SEC’s Division of Enforcement, didn’t hold back. She said:  “Abra sold nearly half a billion dollars of securities to U.S. investors, without complying with registration laws.” Bogert added that Abra was playing a dangerous game, selling its own securities while dodging rules meant to protect investors.  Now, Abra’s facing some serious legal headaches. The SEC has charged Abra with violating multiple sections of the Securities…

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Filed under: News - @ August 26, 2024 9:17 pm