The United States Securities and Exchange Commission (SEC) declared it won’t impose civil penalties on Linus Financial for its unregistered crypto lending product. This decision comes as a result of the firm’s swift cooperation and corrective actions.
“At no point has Linus filed a registration statement with the Commission for the offer and sale of the Linus Interest Accounts. Nor did the offer and sale of the Linus Interest Accounts qualify for an exemption from registration,” the filing explained.
Linus Financial SEC Action Sends A Warning To The Industry
The SEC recently stated that it hasn’t pressed charges against Linus Financial. However, it intends to strongly convey a message to companies offering crypto lending products without the proper licenses.
The statement noted,
“Today’s settlement provides a valuable message to other market participants about the importance of cooperation and remediation.”
To learn more on crypto loans, read BeInCrypto’s guide: How To Get a Crypto Loan? A Step-by-Step Guide
The statement explains that Linus Financial halted its crypto lending product after the SEC took regulatory action against a similar investment product.
Upon realising, Linus allegedly stopped offering Linus interest accounts to new investors. It also requested that existing investors withdraw their funds within the next 30 days. “All investor funds have since been withdrawn,” the statement added.
Stacy Bogert, Associate Director of the SEC’s Division of Enforcement, commented on the matter.
She clarified that the SEC is still actively pursuing companies offering crypto products without the required licenses. “The SEC will continue to hold companies accountable for failing to comply with federal securities laws,” Bogert stated.
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