ATTORNEY NEWSLETTER
30 Enforcement Actions Brought In 2022
SEC Sharpens Focus On Sales Of Unregistered Offerings
Actions For Insider Trading And Market Manipulation
The U.S. Securities and Exchange Commission (SEC) recently released a report entitled “SEC Cryptocurrency Enforcement: 2022 Update” that outlines the increased focus by the SEC on insider trading, market manipulation, and other fraud being perpetrated in cryptocurrency markets. Some of the data from that report is discussed below. Private citizens can help the SEC enforce securities laws such as prohibition of insider trading and in certain cases receive awards where the citizen’s information aids in prosecution and recovery. Assistance and information from whistleblowers are among the most powerful weapons in the law enforcement arsenal of the SEC. The Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”), Pub. L. 111-203, created the SEC Whistleblower Office to encourage and reward private individuals who bring information of securities fraud to the agency’s attention. See Dodd-Frank, 15 U.S.C. § 78a et seq.; Sarbanes-Oxley Act of 2002, Pub. L. 107-204; Securities Act of 1933, 15 U.S.C. § 77a et seq.; Securities Exchange Act of 1934 (“Exchange Act”), 15 U.S.C. § 78a et seq.; Rule 21F4(d), 17 C.F.R. § 240.21F-4(d)(2). Since creation of the SEC program in 2012 the SEC has now awarded over $1 billion to individual whistleblowers, including a single award in December 2022 of $37 million. If you have credible, original information of securities fraud in California call us today at (415)441-8669 and we can help. Our toll-free number is 1-888-50EVANS (888-503-8267). NOTE: We do not take cases for investor losses on cryptocurrency.
Cryptocurrency Insider Trading And Other Fraud
In 2022, the SEC charged a total of 79 defendants or respondents in cryptocurrency enforcement actions, of which 56 (71%) were individuals and 23 (29%) were firms. The proportion of enforcement actions charging only individuals has grown under from nearly 20%, on average, in the 2013‒2020 period to 35% in 2021 and 50% in 2022. Of the 30 total enforcement actions in 2022, 14 involved initial coin offerings (ICOs), and over half (57%) of these ICO-related actions included a fraud allegation. In addition, the SEC brought first-of-their-kind charges in 2022 in the cryptocurrency space related to insider trading and market manipulation. Other types of fraud pursued by the SEC in the cryptocurrency space include Ponzi and Pyramid schemes, violations of broker dealer registration requirements, misleading offerings, fraudulent trading, inadequate disclosures, misrepresenting platform technology, and unlawful representations in digital asset offerings.
Awards, Confidentiality And Retaliation Protections
If you have knowledge of insider trading or other fraud in the cryptocurrency market, you may have the basis of an SEC whistleblower action. In fiscal year 2022 alone, the SEC issued approximately $229 million in 103 awards, making it the SEC’s second highest year in terms of dollar amounts and number of awards. The Whistleblower Program also received a record high number of whistleblower tips alleging wrongdoing—more than 12,300 whistleblower tips—in fiscal year 2022.
SEC whistleblower cases begin by submitting a TCR (tips, complaints and referrals) Form to the SEC. As set forth in the Dodd-Frank Act, the SEC protects the confidentiality of whistleblowers and does not disclose any information that could reveal a whistleblower’s identity. The law also protects whistleblowers from employer retaliation for blowing the whistle on securities fraud under the Exchange Act, the Securities Act of 1933, 15 U.S.C. §§ 77a et seq, Rule 10b-5, or any other federal securities law. See 15 U.S.C. § 78u-6(h)(1); 17 CFR § 240.21F-2; Commission Rule 21F-17(a). If your employer retaliates against you in violation of the statute, you can bring an action in federal court seeking reinstatement, double back pay with interest, and attorneys’ fees and costs. 15 U.S.C. § 78u-6(h)(1)(B) and (C). We can represent you in your action for wrongful retaliation as well as in your underlying SEC whistleblower case.
Contact Us
If you have information of securities fraud call Ingrid M. Evans at Evans Law Firm at (415) 441-8669, or by email at <a href=”mailto:info@evanslaw.com”>info@evanslaw.com</a>. Our toll-free number is 1-888-50EVANS (888-503-8267). NOTE: We do not take cases for investor losses on cryptocurrency.
