Investing.com - Financial Markets Worldwide
💎 Fed’s first rate cut since 2020 set to trigger market. Find undervalued gems with Fair ValueSee Undervalued Stocks

Another court applies the Howey investment contract analysis to crypto

Published 01/16/2021, 12:37 PM
Updated 01/16/2021, 02:20 PM
Another court applies the Howey investment contract analysis to crypto

On June 25, 2020, the United States Securities and Exchange Commission brought suit in the Northern District of California against NAC Foundation LLC, also known as the NationalAtenCoin Foundation, and Rowland Marcus Andrade, the company’s CEO, alleging that the company had violated the federal securities laws by selling an unregistered, pre-functional version of an “Anti-Money Laundering BitCoin” token, to be known as AML BitCoin.

Unlike some of the other recent high-profile decisions applying the Howey Test, such as SEC vs. Telegram and SEC vs. Kik, the NAC lawsuit involved detailed allegations of fraud in connection with the sale of pre-functional tokens. Andrade was also indicted by the Department of Justice on charges of fraud arising out of the offering, and Jack Abramoff, a federal lobbyist, pled guilty to participating in the fraud.

  1. Did the purchasers invest something of value?
  2. Was there a common enterprise?
  3. Was the reason for their investment an expectation of profits?
  4. Were the purchasers relying on the essential managerial or entrepreneurial efforts of others?
Carol Goforth is a university professor and the Clayton N. Little professor of law at the University of Arkansas (Fayetteville) School of Law.

Continue Reading on Coin Telegraph

Latest comments

Install Our App
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.