TechFlow reports that Linus Financial, a crypto services company, has reached a settlement with U.S. securities regulators over allegations of offering and selling unregistered retail crypto lending products. The SEC announced the settlement, primarily concerning Linus's crypto lending product, Linus Interest Accounts. Due to Linus Financial’s cooperation and timely remedial actions, the SEC decided not to impose civil penalties.
The SEC's order states that Linus Financial began offering and selling interest-bearing accounts in March 2020, allowing U.S. investors to deposit fiat currency in exchange for promises of interest payments from Linus Financial.
In its statement, the SEC said the order determined that Linus Interest Accounts were offered and sold as securities, and these offerings and sales did not qualify for any exemption from registration under the SEC, meaning Linus Financial was required to register the offer and sale of its Linus Interest Accounts.
Stacy Bogert, Deputy Director of the SEC’s Division of Enforcement, said that while the SEC will continue to hold firms accountable, it also aims to encourage cooperation and immediate corrective actions when issues arise. She added that this settlement sends an important message about the significance of cooperation and remediation.
