Issuer of Unregistered $25 Million Ico Settles with SEC
Dec. 23, 2020
File no. 3-20188
Company Agrees to Return Money to Investors
The Securities and Exchange Commission today announced settled charges against Texas-based blockchain startup company Tierion, Inc. for conducting an unregistered offering of securities in the form of a "token sale." Tierion has agreed to return funds to harmed investors, pay a $250,000 penalty, and disable trading in its "tokens."
According to the SEC's order, Tierion raised approximately $25 million through the sale of "Tierion Network Tokens" (TNT) in July of 2017. The order finds that Tierion told investors that it would use the sale proceeds to fund the continued development of the "Tierion Network," through which Tierion would offer a "blockchain receipt" service and other yet-to-be-developed services. The order also finds that TNT are securities, that Tierion did not register its token sale as a securities offering pursuant to the federal securities laws, and that the offering did not qualify for an exemption from the registration requirements.
The SEC's order finds that Tierion violated securities registration provisions of Sections 5(a) and 5(c) of the Securities Act of 1933, and requires it to pay a $250,000 penalty. As part of the settlement, Tierion undertakes to disable trading of TNT. Tierion also undertakes to provide compensation to current holders of TNT who purchased in the token sale or in the secondary market, or who received TNT as a reward from Tierion, and to those who purchased TNT in the token offering and later sold at a loss. Tierion consented to the order without admitting or denying its findings.
The SEC's case was handled by Emily R. Holness, Colin D. Forbes, Sofia Hussain, and Amy Gwiazda of the Boston Regional Office.