New York Attorney General Letitia James. AP Photo/Brittany Newman)
A cryptocurrency platform thought the rules didn’t apply to it, and it’s now being sued by New York State Attorney General Letitia James.
James alleges that Nexo Inc and Nexo Capital Inc. failed to register with the state as brokers or dealers in securities and commodities and lied to investors about their registration status.
James explained that his office warned Nexo before filing the complaint that any entity in New York that engages in the offering, buying, or selling of securities or commodities, including cryptocurrency, must s register with the Attorney General’s Office.
“Cryptocurrency platforms are not exceptional; they have to register to operate like other investment platforms,” Attorney General James said. “Nexo has violated the law and the trust of investors by falsely claiming that it is a licensed and registered platform. Nexo must end its illegal operations and take the necessary measures to protect its investors. »
James said approximately 10,000 New Yorkers have accounts with Nexo, who will be charged with violating Martin’s Law and Executive Law Section 63(12). The Attorney General is seeking the restitution of thousands of defrauded investors, the return of income from the company’s illegal conduct, and permanent injunctions against Nexo as well.
The Attorney General has focused on the crypto industry, particularly since markets hit notable lows in June 2022. That month, she warned New Yorkers of some of the dangers and noted that she had created a page on the Attorney General’s website to file complaints. It was after, in October 2021, that she ordered unregistered crypto platforms, including Nexo, to cease operations in the state. In June 2022, James reached a nearly $1 million settlement with crypto platform BlockFi Lending LLC for the sale of unregistered securities.