The New York City-based cryptocurrency company is pushing back at the Securities and Exchange Commission’s (SEC) fraud lawsuit, accusing the agency of cherry-picking issues and conflating them into a bogus prosecution.
CoinTelegraph reports that Unicoin asked a New York federal judge to dismiss the SEC’s lawsuit, arguing that it “plucks snippets of communications and distorts their meaning and context; treats routine financial projection and optimism as fraud; and ignores Unicoin’s sober warnings about risk … Most bizarrely, the SEC twists Unicoin’s disclosures in the company’s own SEC filings and improperly recasts these disclosures as proof of deception.”
In May, the SEC sued Unicoin, its CEO Alex Konanykhin, board member Silvina Moschini and former investment chief Alex Dominguez, alleging they raised $100 million through misleading investors about certificates that conveyed rights to receive Unicoin tokens and stock. When the lawsuit was filed, Mark Cave, associate director in the SEC’s Division of Enforcement, declared, “We allege that Unicoin and its executives exploited thousands of investors with fictitious promises that its tokens, when issued, would be backed by real-world assets including an international portfolio of valuable real estate holdings. But as we allege, the real estate assets were worth a mere fraction of what the company claimed, and the majority of the company’s sales of rights certificates were illusory. Unicoin’s most senior executives are alleged to have perpetuated the fraud, and today’s action seeks accountability for their conduct.”
Unicoin stated the SEC’s lawsuit lacked evidence to prove its case against the company.
“Securities fraud demands more,” said in its response to the lawsuit. “It requires a false statement, made with scienter, that reasonable investors would have relied on. Where, as here, the very risks the SEC identifies were disclosed openly and repeatedly, those elements cannot be met.”
Unicoin asked for the dismissal of SEC’s lawsuit with prejudice, thus ensuring it would not be refiled.
