On May 21, the U.S. Securities and Exchange Commission (SEC) filed a lawsuit against Unicoin, headquartered in New York City, and its three executives - CEO and Chairman Alex Konanykhin, former President and former Board Chairman, current Director Silvina Moschini, and former Chief Investment Officer Alex Dominguez - alleging false and misleading statements in the sale of "equity certificates" and Unicoin's common stock. The "equity certificates" were claimed to grant investors future rights to a cryptocurrency called Unicoin.
The SEC alleged that Unicoin promoted equity certificates to the public through massive market advertising, including advertisements at major airports, thousands of taxis in New York City, television, and social media. Unicoin and its executives allegedly induced over 5,000 investors to purchase these equity certificates through false and misleading statements. Unicoin and Konanykhin also violated securities laws by selling equity certificates to the public without registration.
The complaint stated that Konanykhin violated the law by selling over 37.9 million of his personally held equity certificates to provide more favorable prices and attract investors previously prohibited by the company from participating, thereby circumventing registration exemption clauses. In the lawsuit filed in the Southern District of New York Federal Court, the SEC accused Unicoin, Konanykhin, Moschini, and Dominguez of violating anti-fraud provisions in federal securities laws, accused Unicoin and Konanykhin of violating registration requirements of the 1933 Securities Act, and accused Konanykhin of "controlling person" liability for part of Unicoin's fraudulent activities.
The SEC seeks to issue permanent injunctions against all defendants, requiring them to return illegal gains and pay pre-judgment interest and civil penalties, while also prohibiting Konanykhin, Moschini, and Dominguez from serving as executives or directors of any public companies.
