SEC Charges Lawyer for Violations in Connection with Crypto Asset Securities Offering
ADMINISTRATIVE PROCEEDING
File No. 3-21682
September 20, 2023 - The Securities and Exchange Commission today announced settled charges against James Michael Wines ("Wines"), arising out of his role in a crypto asset securities offering that raised more than $1.5 million from over 30 investors in May 2021. According to the SEC's order, Wines participated in the drafting, review, and approval of an April 2021 press release that promoted the offering and the underlying purchase agreements for the offering.
According to the SEC's order, the April 2021 press release stated that the offering had secured commitments for over $50 million, when in fact $50 million had not been committed or transferred from investors. The order further finds that the offering agreements included use of proceeds provisions that described the recipient of proceeds from the offering as a "contractor," rather than a creditor who had obtained a substantial judgment against one of the offering entities. According to the SEC's order, Wines participated in the drafting, review, and approval of these documents without exercising reasonable care to determine the accuracy of these statements. The order acknowledges Wines's cooperation and that he has returned to investors the offering proceeds under his control.
The SEC's order finds that Wines violated Sections 17(a)(2) and (3) of the Securities Act of 1933. Without admitting or denying the findings in the SEC's order, Wines consented to a cease-and-desist order and additional proceedings to determine what, if any, disgorgement and prejudgment interest or civil penalties are appropriate.
The SEC's investigation was conducted by Brittany Garmyn and Sarah Allgeier and supervised by C. Joshua Felker and Melissa Hodgman.
Last Reviewed or Updated: Sept. 20, 2023