Eight states announced on Monday they’re bringing actions against the crypto-lending platform Nexo Group in connection with its unregistered, interest-bearing cryptocurrency product.
State regulators in California, Kentucky, New York, Maryland, Oklahoma, South Carolina, Washington and Vermont allege Nexo offered customers interest-earning accounts without first registering them as securities and providing necessary disclosures. Without access to these financial statements, state regulators contend investors cannot make informed investment decisions.
The filings also alleged that Nexo misrepresented the accounts and suggested to investors that it is a licensed and registered platform. These interest-earning accounts, known as “Earn Interest Product,” allowed investors to deposit assets with Nexo in exchange for earning yields as high as 36% on their deposits, according to one of the filings.
‘Enforcement 40’ for 2020
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