New York’s Attorney General Bent on Shutting Fraudulent Crypto Platform
New York’s attorney general has filed a lawsuit against a cryptocurrency platform, known as Coinseed Inc. They have been allegedly involved in defrauding thousands of investors by selling worthless digital tokens and charging them with hidden fees. The lawsuit is filed to shut down the fraudulent firm.
Letitia James, Attorney General, states that the firm was involved in trading bitcoin but they were not registered as broker-dealers. They sold CSD tokens without any authorization and raised money for its mobile application startup.
Coinseed’s Chief Executive, Delgerdalai Davaasambuu, and Sukhbat Lkhagvadorj, former Chief Financial Officer, have also been sued by James. According to her, they have overstated their company’s management experience. Lkhagadorj is being sued for misrepresenting his former career as a trader on Wall Street.
According to James, the total fraud by Coinseed is worth more than $1 million. The Attorney General is looking restitute of funds for victim investors.
A lawsuit related to this against Coinseed has been filed by the U.S Securities and Exchange Commission as well.
Davaasambuu said in an email, referring to James’ lawsuit. “I’m 100% sure that the suit is full of false accusations. It’s very strange that they’re blaming the very nature of how a startup works.”
Jame’s lawsuit is alleged violations of a state securities law, Matin Act, in Manhattan Supreme Court. Manhattan Federal court will be handling the SEC’s lawsuit.
James said in a statement, “Unregulated and fraudulent virtual currency entities, no matter how big or small will no longer be tolerated in New York. Coinseed had touted the CSD token as a great opportunity for young people who want to make money in the crypto market. and that the mobile app was guaranteed to help push its market value higher. In truth, nearly three years later, the CSD token has not been listed anywhere.”