The SEC charged Touzi Capital and CEO Eng Taing with defrauding over 1,000 investors in unregistered securities, raising $100 million.
Touzi Capital and its proprietor, Eng Taing, have been accused of securities violations by the US Securities and Exchange Commission (SEC). The SEC also accused the firm of fraud for the way in which it commingled and misappropriated investors’ funds.
SEC filed charges against Touzi Capital and its CEO.
The United States Securities and Exchange Commission (SEC) has filed a civil action against Touzi Capital and its CEO, Eng Taing, in a press release. The company is accused of defrauding over a thousand investors in unregistered securities offerings that raised over $100 million.
The Commission’s complaint also asserts that the defendants deceived investors regarding the management of the proceeds from these offerings. According to the Securities and Exchange Commission (SEC), Touzi Capital and its CEO raised capital through false and misleading statements and commingled and misappropriated investors’ funds.
These statements encompassed statements regarding the liquidity of their investments and other factors that were associated with their profitability. To provide context, Touzi Capital is a company that provides investment opportunities in blockchain, private equity, and real estate.
The US Securities and Exchange Commission (SEC) is responsible for overseeing securities violations, which also encompasses the cryptocurrency sector. Nevertheless, CoinGape recently reported that Donald Trump intends to grant the US Commodity Futures Trading Commission (CFTC) supervision of the $3 trillion crypto market, which will encompass blockchain technology.
Information Regarding the Commission’s Complaint
Touzi Capital and Taing conducted unregistered securities offerings of their crypto asset mining funds between 2021 and early 2023, as per the US SEC’s complaint. The firm claimed that the funds were intended to support the operations of a specific crypto asset mining entity. It secured nearly $95 million from more than 1,200 investors across the country.
Nevertheless, it appears that the organization has deceived investors in this regard. The Commission claims that the defendants commingled these funds among their numerous businesses, some of which were unrelated to crypto asset mining.
The CEO’s involvement was also emphasized, as he allegedly misappropriated some of these funds for personal use and misled investors about the profit margins of their business operations.
The US SEC also alleges that Touzi Capital raised nearly $23 million for its debt rehabilitation business, but it commingled these funds with those of its crypto asset mining business and other unrelated businesses.
Additionally, the Commission is purported to have misled investors regarding the stability of these investments by equating them to high-yield money market accounts, despite the fact that the investments were illiquid and hazardous. Nevertheless, the SEC asserted that Touzi continued to attract additional investments even after the investments began to fail.
The SEC is seeking civil penalties, disgorgement with prejudgement interest, and permanent injunctions against the defendants. Additionally, it desires an officer and director’s prohibition against Taing. In the midst of this development, another case is also being examined, as former CFTC and XRP counsel have suggested that the Commission may withdraw its appeal in the Ripple lawsuit.
