Justin Sun, founder of the Tron Foundation and BitTorrent Foundation, whose alleged securities violations led to executive action last month from the Securities and Exchange Commission (SEC), has reportedly received a subpoena from a court in the Southern District of New York.
A report in the Straits Times newspaper on Thursday said the summons were directed to two addresses in Singapore. It gives him 21 days to respond.
The Securities and Exchange Commission on March 23 He sued v. Sun Corporation and three entities, Tron Foundation Limited, BitTorrent Foundation, and Rainberry Inc. The agency has filed a series of charges against Sun.
Multiple crimes
Sun is accused of trading Tronix (TRX) and BitTorrent (BTT) without registering them as securities. And with undisclosed amounts paid to celebrities, including Lindsay Lohan and Austin Malone, for their endorsement of crypto assets and products.
The SEC is also accusing Sun of a practice known as laundry trading. This is a variant of the “pump and dump” schemes. It involves the buying and selling of a security in one or two narrowly spaced transactions. Thus promoting the emergence of heavy commercial activity, while there is no change in beneficial ownership.
The agency’s March 23 announcement of the enforcement action explained:
“From at least April 2018 through February 2019, Sun allegedly directed his employees to participate in more than 600,000 TRX laundering transactions between two crypto-asset trading accounts he controls, with between 4.5 million and 7.4 million TRX launders transacting daily.”
He was also vocal about Sun’s use of family names as supporters.
“Sun further urged investors to buy TRX and BTT by staging a promotional campaign in which he and the famous promoters hid the fact that the celebrities had been paid for their tweets.”
Even during the SEC’s enforcement action, Sun sounded a careless note in his public statements. In a tweet dated April 11, he posted a video of a social event in the crypto industry in Hong Kong. Sun wrote that hosting such a “wonderful event” in Hong Kong affected him deeply. he added:
“Our ultimate goal is to host cryptocurrency events in Beijing and Shanghai,” he said. “I am confident that we will be able to achieve this within a few years.”
Nowhere has Sun acknowledged that selling and trading cryptocurrencies is illegal in all of China.
This is a developing story.
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