BLOCKCHAIN LAW GROUP

Where Technology Meets Law
The SEC obtained a cease-and-desist order against Loci Inc. and its CEO John Wise
The SEC obtained a cease-and-desist order against Loci Inc. and its CEO John Wise for violating the U.S. securities law while selling LOCIcoin in August 2017 – January 2018. LOCIcoin was used as an instrument to raise capital to support the company’s software platform InnVenn, which provided intellectual property search to inventors and other users. During its investigation, the SEC determined that LOCIcoin was a security. Under the U.S. securities law, offering and sale of securities has to be registered with the SEC or qualify for an exemption. This procedure was not followed by Loci Inc., in violation of the registration provisions of the Securities Act of 1933.

In addition, the SEC alleged that Mr. Wise made numerous materially false statements to investors about Loci Inc.’s revenues, number of employees, and Inn Venn’s user base. Moreover, according to the order, Mr. Wise misused close to $40,000 of the invested funds for his personal expenses.

Loci Inc. and Mr. Wise settled the charges with the SEC and agreed to delist and destroy all LOCIcoins. In addition, Loci Inc. agreed to pay a $7.6 million civil penalty, while Mr. Wise agreed to an officer and director bar.



Summarized by Katrina Arden, Esq.
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