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First US Regulated Crypto Asset Fund Against The SEC
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First US Regulated Crypto Asset Fund Against The SEC

The SEC (U.S Securities and Exchange Commission) revealed on Tuesday that is has taken action against two digital currency companies. Both mark the first ever action of their kind by the SEC. One of the firms is against a ‘superstore’ for ICOs and the other is against a firm which claims to bring the first regulated crypto asset fund to the United States. On 11th September, the SEC “announced its first ever enforcement action finding an investment company registration violation by a hedge fund manager based on its investments in digital assets.” La Jolla, the company from California, aims to focus on managing investment portfolios of digital currencies and assets which are related. The SEC noted:
“The SEC entered an order finding that crypto asset management LP (CAM) offered a fund that operated as an unregistered investment company while falsely marketing it as the first regulated crypto asset fund in the United States.”
According to the order against CAM and its lone major, Timothy Enneking, the company had brought in over $3.5 million in over a four month period in the back end of 2017. The SEC explained this by saying:
“By engaging in an unregistered non-exempt public offering and investing more than 40% of the fund’s assets in digital asset securities, CAM caused the fund to operate as an unregistered investment company.” After the company was contacted by the SEC, the firm “ceased its public offering and offered buybacks to affect investors… CAM and Enneking agreed to the SEC’s cease and desist order and censure without admitting or denying the findings against them, and agreed to pay a penalty of $200,000.”
On the same day, the Commision made a move against another crypto business and its owners, Eli L. Lewitt and Lenny Kugel. The firm has described itself to be an ICO Superstore. In the end the SEC stated that both “Kugel and Lewitt agreed to pay penalties of $45,000 each and agreed to industry and penny stock bars and an investment company prohibition with the right to reapply after three years.”

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