A federal judge criticized the SEC’s handling of a crypto firm, accusing the agency of making false representations to freeze assets tied to Digital Licensing Inc., also known as DEBT Box.
The case in Utah federal court involves allegations of defrauding investors through unregistered securities sales. The judge rebuked the SEC for obtaining a temporary restraining order and asset seizure without informing the crypto firm, later discovering misrepresentations in the SEC’s claims about closed bank accounts and social media blocking. The judge’s order demands the SEC provide reasons to avoid potential sanctions for its behavior, emphasizing concerns over the integrity of the proceedings.
This controversy adds to the SEC’s ongoing legal battles with prominent crypto companies, sparking industry criticism of the agency’s approach under Chairman Gary Gensler.