Yugocean
Valued Contributor
The crypto lending firm BlockFi has been found guilty by regulators in the state of Iowa of making false claims about the collateral status of loans provided by the firm.
According to ads from BlockFi, it had overcollateralized a significant amount of loans; but an investigation by the "Iowa Insurance Division" found that only a small percentage of loans were overcollateralised. Thus on the basis of false claims made in the advertisements, BlockFi was found guilty of violating "Chapter 502 of the Uniform Securities Act".
As a result, BlockFi has been ordered to pay an administrative fee of $943k. BlockFi will have to pay in five installments of approximately $188k. One of the Platforms hit by the bear market, BlockFi recently laid off about 20% of its workforce to cut costs, but now this fine will only squeeze it out.
The states of New Jersey, Alabama and Vermont also have cases against BlockFi for allegedly selling unregistered securities if they also impose fines, it could end BlockFi's business.
According to ads from BlockFi, it had overcollateralized a significant amount of loans; but an investigation by the "Iowa Insurance Division" found that only a small percentage of loans were overcollateralised. Thus on the basis of false claims made in the advertisements, BlockFi was found guilty of violating "Chapter 502 of the Uniform Securities Act".
As a result, BlockFi has been ordered to pay an administrative fee of $943k. BlockFi will have to pay in five installments of approximately $188k. One of the Platforms hit by the bear market, BlockFi recently laid off about 20% of its workforce to cut costs, but now this fine will only squeeze it out.
The states of New Jersey, Alabama and Vermont also have cases against BlockFi for allegedly selling unregistered securities if they also impose fines, it could end BlockFi's business.
