Telegram Group Inc. has agreed to return $1.2 billion to investors and pay a $18.5 million civil penalty to settle allegations of unregistered digital token issuance, the U.S. Securities and Exchange Commission said on Friday.
Telegram and the Securities and Exchange Commission have been at loggerheads over the $1.7 billion ICO for its blockchain project since October, and the Securities and Exchange Commission said in a statement Friday that it has obtained court approval to reach a settlement with Telegram and its TON issuer subsidiary.
The SEC’s position is that the first issue is a securities issue and therefore complies with the SEC’s issuance rules, which require companies to file registration and disclosure documents.
“New innovative companies are welcome to participate in our capital markets, but they cannot violate the registration requirements of federal securities laws.” Kristina Littman, head of the SEC’s law enforcement network division, said.
Original title: Is the first issue of securities issued? U.S. court orders Telegram to pay $1.2 billion and $18.5 million in damages