The Securities and Exchange Commission (SEC) filed a lawsuit against XBT Corp. SARL for allegedly offering and selling unregistered security-based swaps to U.S. investors using bitcoins.
The SEC also accused the company of failing to conduc
XBT Corp is a securities dealer based in Switzerland. It is doing business as (d/b/a) First Global Credit.
In its investigation, the Commission found that First Global Credit used different marketing strategies to target and solicit U.S. individuals to deposit and use bitcoins to buy and sell a variety of investment products.
The company described its investment products using various terminologies including “bitcoin Asset Linked Notes.” However, investors were able to participate in the price movements of securities including those listed on U.S. stock markets even if they do not own them.
Under U.S. federal securities laws, those types of transactions are considered security-based swaps. First Global Credit conducted transaction to U.S. investors “without complying with the registration and exchange requirements governing security-based swaps, which were enacted as part of the Dodd-Frank Act,” according to the SEC.
First Credit Global settles SEC, CFTC complaint
According to the SEC, First Credit Global offered to settle the allegations against it. The Swiss-based securities dealer agreed to a cease-and desist order and to pay disgorgement of $31,687 and a civil penalty of $100,000.
