A US District Court has reportedly put an immediate block on the $8 million worth of assets, related to 2 New York citizens, who are involved in a legal case submitted by the US SEC on August 12. 

Following the request from the US SEC on August 13, to issue a freeze of up to $8 million, of the total $14.8 million in the custody of Reginald “Reggie” Middleton, along with his 2 establishments, Veritaseum, Inc. and Veritaseum, LLC, opened in 2017 and 2018 via an illegally raised funds from an unlicensed ICO.

The SEC accused the defendants of breaking the federal laws, regarding the registration and antifraud provisions, together with manipulative trading.

The firm conducted transactions using a 30:1 ratio Ether-pegged token, dubbed VERI, that runs on the Ethereum Blockchain, and advertised as a utility token, which is redeemable for numerous beneficial causes such as consulting and advisory services and purportedly unlimited access to research.

The SEC accordingly demanded the defendants to take care of the fee for permanent injunctions, disgorgement, interest, and penalties and a bar from offering digital securities.

“After learning about Middleton’s transfer of funds, we took quick action to prevent the further dissipation of investor assets. Whether in digital currency or plain cash, we will act to protect investor assets and to pursue fraud and manipulation in our securities markets.” Marc P. Berger, director of the SEC’s New York Regional Office, added.

The court has reportedly authorized temporary injunction, and further ordered the New York men to present cause on August 22. The case will be handled by  Judge William F. Kuntz, II, starting August 13.