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Thor Technologies Faces Legal Defeat in SEC Lawsuit
Thor Technologies, led by its founder David Chin, has suffered a legal defeat in an ongoing dispute with the U.S. Securities and Exchange Commission (SEC) regarding the unauthorized sale of $2.6M crypto asset securities. The SEC recently announced a default judgment against Chin and Thor issued by a San Francisco district court on Wednesday.
Thor Token: A Failed Project
The SEC filed a complaint on December 21, 2022, stating that Chin and Thor Technologies raised $2.6 million from 1,600 investors between March and May 2018 through the sale of its Thor (THOR) coin. However, the project was never materialized. Around 200 of these investors were from the United States.
The SEC alleged that Chin and Thor violated federal securities laws by offering and selling unregistered Thor Tokens without qualifying for an exemption.
False Statements to Investors
In addition to the unregistered sale of tokens, the SEC claimed that Chin and Thor made false and misleading statements about the project’s progress, partnerships, and revenue to investors.
Chin promised investors repayment after announcing the shutdown of operations due to regulatory challenges in April 2019. However, he failed to return any funds to investors and diverted some earnings into his personal bank account.
Court Ruling and Penalties
As Chin and Thor did not respond to the SEC’s complaint or appear in court, the court granted the SEC’s motion for default judgment. They were ordered to pay a total of $903,193.06, including disgorgement of $744,555 and prejudgment interest of $158,638.06.
The court also imposed permanent injunctions against Chin and Thor, prohibiting them from participating in any future offerings of crypto asset securities. However, Chin is still allowed to buy or sell securities for his personal account.
SEC’s Continued Monitoring
The SEC emphasized its intention to continue monitoring the cryptocurrency landscape and take action against those who violate securities laws.
Hot Take: SEC’s Ruling Highlights Regulatory Scrutiny in Crypto
The recent ruling by the U.S. Securities and Exchange Commission (SEC) against Thor Technologies serves as a reminder of the regulatory scrutiny faced by the crypto industry. The SEC’s complaint alleged that Thor Technologies and its founder, David Chin, violated federal securities laws by offering and selling unregistered Thor Tokens without qualifying for an exemption.
In addition to the unauthorized sale of tokens, Chin and Thor were accused of making false statements to investors about the project’s progress and partnerships. The court granted a default judgment against them, ordering them to pay over $900,000 in penalties.
This case highlights the importance of compliance with securities laws in the crypto space. The SEC’s continued monitoring and enforcement actions send a clear message that regulators will not tolerate violations and will take action to protect investors.
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