SEC bags $8.2B in fines in 2024, over half from Terraform
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Homepage > News > Business > SEC bags $8.2B in fines in 2024, over half from Terraform The United States Securities and Exchange Commission (SEC) hit a new record for penalties and fines from its enforcement actions in the fiscal year 2024, largely thanks to a substantial settlement in its case against Terraform Labs. In its November 22 annual report, the agency announced that it had obtained orders for $8.2 billion in financial remedies for the year ending September 30, “the highest amount in SEC history.” The $8.2 billion consisted of $6.1 billion in disgorgement—the return of ill-gotten gains to those wronged—and prejudgment interest, also the highest amount on record, and $2.1 billion in civil penalties, the second-highest amount on record. Despite these impressive hauls, the SEC stated that the 583 enforcement actions represent a 26% decline in total enforcement actions compared to fiscal year 2023. This makes sense when considering that a whopping 56% of the $8.2 billion financial remedies came from a single case, the SEC’s jury trial win against Terraform Labs and its former CEO Do Kwon. In May 2022, the Terraform ecosystem collapsed when its UST algorithmic stablecoin lost its peg to the U.S. dollar. This led to the printing of more of the company’s native token, LUNA, to prop up UST. It eventually led to a crash in LUNA and an estimated $60 billion being wiped out of the digital asset space. In February 2023, the SEC charged Terraform and Kwon in the U.S. District Court for the Southern District of New York with securities fraud and for offering and selling securities in unregistered transactions. After a long drawn-out trial, in April this year, a jury unanimously found the company and its founder liable for securities fraud, with Terraform and Kwon subsequently agreeing to pay a $4.47 billion settlement. “The Division of Enforcement is a steadfast cop on the…
Filed under: News - @ November 29, 2024 12:18 pm