The court found that the corporation suffered irreparable harm as a result of the actions.
A federal court reprimanded US SEC lawyers for their management of Debt Box’s assets.
On Friday, December 1, 2023, a federal judge reprimanded the SEC’s lawyers in a lawsuit involving a cryptocurrency company, dealing another legal blow to the U.S SEC. The court allegedly blasted the SEC for its management of the company’s capital, saying that the agency had fabricated “materially false” claims in order to seize assets.
Fortune reports that a federal court reprimanded US SEC lawyers for their management of crypto company Debt Box’s assets, valued at millions of dollars. In order to freeze assets, the agency used “materially false and misleading representations,” according to the Utah court judge. The court had previously requested the SEC provide justification for its refusal to be penalized for deceiving the court.
Enforcement by Action
The court found that the corporation suffered irreparable harm as a result of the Commission’s deceptive activities, which resulted in the freezing of assets worth millions of dollars. The SEC submitted the purportedly deceptive and inaccurate data to the court in its pursuit of a temporary restraining order against the cryptocurrency firm.
This follows a string of recent court defeats suffered by the SEC. In the XRP case summary judgment, Judge Analisa Torres partially sided with Ripple, ruling that the programmatic selling of tokens to retail users did not constitute as securities—the worst legal setback so far.
Moreover, prominent crypto exchanges are embroiled in legal battles with the SEC on allegations that they engaged in the unregistered selling of securities. Many prominent leaders of the crypto sector have criticized SEC’s approach and blamed it for suppressing the sector in the U.S with enforcement by action approach.