Rivetz President/CEO Sued Over $18 Million ICO

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  • The president and CEO of Rivetz has been sued by the SEC over its 2017 ICO
  • The SEC alleges that Rivetz conducted an illegal ICO, with the Steven Sprague using the money to buy property
  • Rivetz is the latest 2017/18 ICO to find that the SEC is not letting up in punishing projects from that time

Another day, another 2017/18 ICO gets busted. This time it’s the turn of Rivetz, whose president and CEO Steven Sprague was last week charged with violating securities registration provisions. The Securities and Exchange Commission (SEC), who last week came under fire for their treatment of Coinbase, accused Rivetz and Sprague of an illegal $18 million token sale, with the money allegedly going to fund property purchases on behalf of Sprague. Rivetz is the latest in a long line of 2017/18 ICOs suddenly finding that the Wild West of crypto is being retrospectively marshalled.

Rivetz Alleged to Have Broken Securities Laws

Rivetz ran an ICO between July and September 2017, selling RvT tokens to the general public, including U.S. investors. The complaint alleges that Sprague marketed Rivetz as an investment opportunity by promoting the value of RvT tokens to investors, stating on which exchanges RvT tokens would be listed and when, using Sprague’s abilities and managerial skills as selling points, and claiming RvT tokens would bring a financial reward to investors.

As well as these complaints, the SEC determined that RvT tokens could not be used to purchase any good or service at the time they were sold and that the ICO, which raised $18 million, was not registered with the SEC and did not qualify for any exemption from registration. As a result the SEC has demanded “injunctive relief, the return of allegedly ill-gotten gains plus prejudgment interest, and a civil penalty.”

Sprague Bought Cayman Island Home

The SEC says that some of the Rivetz ICO money went straight into Sprague’s pockets, with a $1 million ‘bonus’ and $2.5 million loan going towards the purchase of a house in the Cayman Islands. Despite dying a death after the 2017 crypto boom, which saw the RvT token hit $3.50, it still has a market cap of $274,000 and is tradable on the Bancor network.