The United States Securities and Exchange Commission (SEC) on Wednesday charged Rivetz Corp., Rivetz International SEZC, and Steven K. Sprague, the President of Rivetz and CEO of Rivetz International, with conducting an illegal, unregistered offering of securities through an initial coin offering.
According to the SEC’s complaint, between July and September 2017, the defendants offered and sold digital assets designated as “RvT tokens” to the general public, including U.S. investors, for the purpose of capitalizing Rivetz’s business.
The complaint alleges that Sprague marketed RvT as an investment opportunity by promoting the value of RvT to investors; highlighting that RvT would be made available to trade on digital asset trading platforms; describing where RvT could be resold; touting Sprague’s abilities and managerial skills, including his experience as a former officer and director of a public company; and claiming RvT would increase in value as a result of Rivetz’s efforts.
According to the complaint, the RvT tokens could not be used to purchase any good or service at the time they were sold. As alleged, the defendants’ offers and sales of RvT, which raised the equivalent of $18 million in digital assets from investors, were not registered with the SEC and did not qualify for any exemption from registration.
The SEC’s complaint, filed in the District of Massachusetts, charges the defendants with violating the securities registration provisions of Section 5 of the Securities Act of 1933. The SEC seeks injunctive relief, the return of allegedly ill-gotten gains plus prejudgment interest, and a civil penalty.