The US Securities and Exchange Commission (SEC) is seeking nearly $2 billion in fines and penalties from Ripple Labs, the crypto company’s CEO and Chief Legal Officer revealed with a social media post yesterday (Monday).
Heavy Penalties on Ripple
According to a tweet by Ripple’s Chef Legal Officer, Stuart Alderoty, the regulator has already asked the court for heavy fines and penalties. The SEC, which filed the motion under seal, is expected to come up publicly with the move on Tuesday, while Ripple will file its response next month.
Our response will be filed next month, but as we all have seen time and again, this is a regulator that trades in statements that are false, mischaracterized and designed to mislead. They stayed true to form here. 2/4
— Stuart Alderoty (@s_alderoty) March 25, 2024
A Coindesk report detailed that the agency is seeking $1.95 billion in total, out of which $876 million in disgorgement, $198 million in prejudgment interest, and $876 million in civil penalty.
“As we all have seen time and again, this is a regulator that trades in statements that are false, mischaracterized, and designed to mislead. They stayed true to form here,” Alderoty noted.
“Rather than faithfully apply the law, the SEC remains bent on wanting to punish and intimidate Ripple - and the industry at large.”
A High-Profile Crypto Lawsuit
The American regulator first moved against the blockchain company in December 2020, alleging the illegal sale of XRP tokens to both retail and institutional investors, raising more than $1.3 billion. According to the regulator, XRP is unregistered securities.
The initial regulatory lawsuit named Ripple’s CEO, Brad Garlinghouse, and the Co-Founder, Chris Larsen, but charges against them were dropped last October. Last July, the New York federal court ruled that the sale of XRP on exchanges and through algorithms did not violate any American securities law; however, sales to institutions did.
“The SEC asks the Court to consider how easily actors, particularly in the crypto asset space, can today engage in the same sort of conduct as Ripple’s and send a strong message that such abuses will not be tolerated,” the latest motion filed by the SEC stated.
This article was written by Arnab Shome at www.financemagnates.com.
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