SEC Announces Settlement With TrueCoin and TrustToken Over TUSD Charges

Federal securities regulators have reached an settlement with TrueUSD (TUSD) issuer TrueCoin and credit score protocol operator TrustToken to settle fees for the alleged and fraudulent sale of unregistered funding contracts.

The US Securities and Change Fee (SEC) accuses TrueCoin and TrustToken of providing and promoting TUSD as an unregistered safety from November 2020 to April 2023.

The regulator says that whereas TrueCoin and TrustToken claimed that TrueUSD was absolutely backed by the US greenback, a good portion of the property allegedly backing TUSD have been invested in a speculative and dangerous offshore funding fund to generate extra revenue.

The SEC alleges that TrueCoin and TrustToken have been conscious of redemption points on the offshore fund in 2022, however continued to say that TUSD is backed one-for-one by the US greenback.

By March 2022, greater than half a billion {dollars} of the property that may assist TUSD had been invested within the speculative fund. The SEC says that by September 2024, 99% of the reserves supporting the stablecoin have already been invested within the offshore fund.

In a single statementthe SEC says TrueCoin and TrustToken agreed to settle the costs with out admitting or denying the allegations, though the settlements are nonetheless topic to court docket approval.

“TrueCoin and TrustToken have agreed to settle the SEC’s fees by agreeing to enter last judgments enjoining them from violating relevant provisions of the federal securities legal guidelines and to pay civil penalties of $163,766 every. TrueCoin has agreed to pay a payout of $340,930 with accrued curiosity of $31,538.”

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