Tokens sold by Centra Tech are recognized as Securities

The blockchain firm Centra Tech, well-known by some celebrity approvals, has had its tokens ranked as securities by the US Securities and Exchange Commission
28 June 2018   385

In April two founders of Centra Tech were arrested by US authorities. It raised $32 million by falsely claiming to be developing a cryptocurrency debit card in partnership with Visa and Mastercard. Actually, the executive team on the website was fictitious and no such products were being developed. 

We allege that the Centra co-founders went to great lengths to create the false impression that they had developed a viable, cutting-edge technology.
Robert A. Cohen
SEC Cyber Unit Head 

The ICO was promoted by retired boxer Floyd Mayweather and rap musician DJ Khaled. They are not supposed to be involved in the conflict. Lately, Judge Andrea Simonton of the Southern District of Florida court has considered that the tokens sold in the ICO are securities. It has to be marked that the defendents do not contest this point.

According to US law, the determination of a security is: “An offering is an investment contract if there is: (1) an investment of money (2) in a common enterprise, (3) with the expectation of profits to come solely from the efforts of others.”

This investment shouldn`t be cash, but can take the form of assets, as long as the investor commits them “to an enterprise or venture in such a manner as to subject himself to financial losses.” The existence of a common enterprise must then be set up - “a common enterprise exists where the fortunes of the investor are interwoven with and dependent upon the efforts and success of those seeking the investment of third parties.”

Simonton viewed this satisfied as “the fortunes of individual investors in the Centra Tech ICO were directly tied to the failure or success of the products the Defendants purported to develop. An individual investor could exert no control over the success or failure of his or her investment.”

The definition of a security is set and the punishments can start flowing. The defendants did not register their security, they sold their tokens in various states, the plaintiffs have suffered from financial losses.

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Crypto Investor to File Lawsuit Against AT&T

Michael Terpin believes that AT&T helped scammers to still his $24M worth crypto
16 August 2018   109

In the Los Angeles District Court, a 69-page lawsuit was filed by BitAngels founder Michael Terpin against the American telecom giant AT&T. Terpin claims that the operator assisted fraudsters in "stealing digital personal data" from the account on his smartphone, which is why he lost $ 24 million in cryptocurrency, according to an official release.

According to Terpin, for seven months, there were two hacks. Initially, an attacker got access to his phone number without providing a password or correct identification data. Later, the phone number was used to steal crypto.

AT&T’s studied indifference to protecting its customers’ privacy and financial assets is a metastasizing cancer, threatening hundreds of millions of unsuspecting AT&T’s customers. Our client had no idea when he initially signed up, nor when later he was promised the highest level of security for his account, that low-level retail employees with access to AT&T records, or people posing as them, can be bribed by criminals to override every system that AT&T advertises as unassailable.
 

Pierce O’Donnell
Lead counsel for Terpin in this complaint

Michael Terpin requires AT & T to pay him $ 224 million - $ 200 million for moral damages and $ 24 million for actual theft.