The U.S. Securities and Exchange Commission has asked a California federal court to enforce its June subpoenas for documents related to an alleged pump-and-dump scheme that involved claims of a $100 million ICO (initial coin offering).
Officials at the U.S. regulator are investigating Saint James Holding and Investment Company Trust and its trustee, Jeffrey James, months after the agency first moved to suspend trading in penny-stock company Cherubim Interests, Inc.
According to yesterday’s statement, the SEC believes that Cherubim issued false public statements, claiming that the company had “executed a $100,000,000 financing commitment” to launch an ICO for St. James Trust.”
“The SEC’s application seeks an order from the court compelling James and St. James Trust to produce all responsive documents,” the agency said.
“Based on its ongoing, nonpublic investigation, the SEC has reason to believe that to ‘pump’ its stock price, Cherubim issued false public statements in January 2018 claiming that the company had executed a $100,000,000 financing commitment to launch an initial coin offering (‘ICO’) for St. James Trust. After Cherubim’s stock price and trading volume increased on this news, certain individuals associated with the company may have ‘dumped’ their overvalued Cherubim stock for significant profits.”
Despite the fears of many in the cryptocurrency community, the SEC has acted in a thoughtful and responsible way as it looks to regulate digital assets. To date, James and the St. James Trust has yet to respond to the subpoena, despite “personally serving James with copies of the subpoenas.”