The Securities and Exchange Commission (SEC) has filed a settled action with RYVYL Inc, its now-former chief executive officer, Fredi Nisan and its chairman of the board, Benzion Errez.

The SEC’s action, submitted on April 27, 2026, at the California Southern District Court, alleges that RYVYL, Nisan and Errez defrauded the investing public by falsely depicting RYVYL in its public filings with the Commission as a cutting edge “financial technology company that develops, markets, and sells innovative blockchain-based payment solutions” and that its “proprietary blockchain-based technology serves as the settlement engine for all transactions within [its] ecosystem.”

RYVYL’s public filings also detailed its use of a digital “token” to facilitate credit card transactions with merchants using its services.

The action further alleges that these descriptions of the company’s business were materially false and misleading. RYVYL’s actual business was reselling credit card or ACH processing services of other companies to high-risk merchants, such as cannabis dispensaries. RYVYL never processed any transactions through a blockchain as it claimed in its public filings, nor did it possess any proprietary blockchain technology. Despite specifically describing its use in transactions, RYVYL neither sold nor had a functional digital token.

Moreover, until its May 20, 2025 quarterly filing, RYVYL never publicly disclosed that a substantial majority of its transactions involved high-risk merchants, such as cannabis dispensaries, which are disfavored customers by most major credit companies due to the questionable legality of their businesses under federal law.

The SEC accuses RYVYL, Nisan, and Errez of violations of Section 17(a) of the Securities Act and Section 10(b) of the Exchange Act and Rule 10b-5 thereunder. In addition, RYVYL, by filing a materially misleading registration statement, and materially misleading annual, quarterly and current reports with the Commission on Forms S-1, 10-K, 10-Q and 8-K, violated Exchange Act Rules 12b- 20, 13a-1, 13a-11, 13a-13, and Nisan and Errez aided and abetted RYVYL’s violations of those rules.

The SEC requests that the Court impose permanent injunctions against each of the defendants for their respective violations of the federal securities laws; prohibit Nisan and Errez from acting as an officer or director of any issuer that has a class of securities registered pursuant to Section 12 of the Exchange Act, 15 U.S.C. § 78l, or that is required to file reports pursuant to Section 15(d) of the Exchange Act, 78 U.S.C. § 78o(d), pursuant to Section 20(e) of the Securities Act and Section 21(d)(2) of the Exchange Act; and impose civil money penalties against Nisan and Errez pursuant to Section 21(d)(3) of the Exchange Act and Section 20(d) of the Securities Act.