SEC charges “Bruno Block” for conducting unregistered ICO
The United States Securities and Exchange Commission (SEC) has filed a complaint against Amir Bruno Elmaani, who goes by the online alias Bruno Block.
The complaint, submitted at the New York Southern District Court on December 9, 2020, charges Amir Bruno Elmaani, who goes by the online alias Bruno Block, for conducting an illegal securities offering of digital tokens and for his scheme to profit by minting millions of unauthorized tokens for himself at no cost and selling them into the secondary market, thereby causing the value of others’ tokens to plummet.
As alleged in the SEC’s complaint, in the fall of 2017, Elmaani offered and sold tens of millions of digital tokens called Pearl tokens in connection with his venture, Oyster Protocol. According to the complaint, the Pearl tokens were securities, but Elmaani’s offer and sale of Pearl tokens was not registered with the Commission.
The complaint alleges that Elmaani unlawfully raised approximately $1.3 million through his unregistered sale of Pearl tokens. The complaint also alleged that, on or around October 29, 2018, Elmaani used a web of digital wallets to covertly mint approximately four million unauthorized Pearl tokens for himself for free and immediately began selling the tokens in the secondary market.
Elmaani allegedly made approximately $570,000 in illicit gains through the minting and sale of Pearl tokens and, as a result of his sales, the price of Pearl tokens fell by nearly 65%, resulting in significant losses for investors.
The SEC’s complaint charges Elmaani with violating the registration provisions of Sections 5(a) and 5(c) of the Securities Act of 1933 and the antifraud provisions of Section 17(a) of the Securities Act and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder.