On September 8, the Securities and Exchange Commission announced a suit against blockchain identity project Rivetz and founder Steven Sprague over the firm’s 2017 initial coin offering for RvT tokens.
Per the SEC’s complaint, between July and September 2017, Rivetz allegedly sold $18 million worth of RvT via a Cayman Islands affiliate in what was an attempt to obtain capital for the project. Sprague and Rivetz advertised the sale to investors as an investment opportunity. The firm never filed as a securities issuer with the SEC, per the agency’s Wednesday statement.
The SEC has spent years investigating the unregistered offerings of the ICO boom of 2017 and 2018. More recent cases have generally centered on more creative profiteers off the market of the time.
By the SEC’s account, the firm had spent or cashed out all of its ether earnings by March 2018. The agency alleged that “the firm [gave] Sprague a $1,000,000 one-time bonus, and [loaned] Sprague $2,500,000, which he used to purchase a house in the Cayman Islands that he then leased back to Rivetz Int’l.”
In its complaint, the SEC requests disgorgement of all funds from the raise as well as a penalty, but it doesn’t specify how much it is seeking.
The largest ICO in history was Block.one’s $4 billion offering of EOS tokens, which the SEC ultimately resolved with a settlement.