Alright, so last month, Unicoin’s CEO decided to turn down the SEC’s offer to talk things out. The U.S. Securities and Exchange Commission went ahead and sued Unicoin and three top dogs on Tuesday night for fraud. According to the SEC, the company managed to raise over $100 million for tokens that weren’t actually backed by any real estate, despite what the executives claimed.

The SEC named Unicoin, CEO Alexander Konanykhin, former board chair Maria Moschini, senior VP and general counsel Richard Devlin, and former chief investment officer and investor relations officer Alejandro Dominguez in the lawsuit for violating securities laws. One of the allegations was that Unicoin never really owned the real estate properties they told investors they had. The SEC claimed that the values of these properties were inflated. For instance, between September 2023 and January 2024, the defendants supposedly announced acquisitions of properties in Argentina, Thailand, Antigua, and the Bahamas with appraised values totaling over $1.4 billion. However, most of these transactions never actually happened, and the real combined value of the properties was only around $300 million.

On top of all that, the SEC alleged that the defendants exaggerated Unicoin’s sales of its rights certificates. They made social media posts and told investors that they had raised way more funds than they actually did. Even though Unicoin claimed to have made $3 billion in sales by June 2024, they never sold more than $110 million in their rights certificates, as per the complaint. Furthermore, Unicoin went all out in advertising its rights certificates, promising returns of up to 9 million percent. They promoted these certificates on taxi cabs, ferries, office building screens, digital billboards, coasters, TV programs, news websites, and public Wi-Fi kiosks.

So, Unicoin received a Wells notice from the SEC last December, indicating that the regulator, back when Gary Gensler was still in charge, intended to file securities fraud charges. But guess what? Konanykhin, the CEO, decided to send a letter to Unicoin’s shareholders declining the SEC’s attempt to settle the charges. He thought the SEC’s demands before the settlement negotiation meeting were just not cool and believed that the SEC’s investigation had caused the company some serious losses.

Not really sure why this matters, but according to court documents, the SEC is looking to get some disgorgement and civil penalties from Unicoin and the executives. As of now, neither Konanykhin nor a spokesperson for Unicoin has responded to any requests for comments. In a press release shared earlier this year, a spokesperson for Unicoin said that the company has always followed all the regulations. So, let’s see how this whole situation unfolds in the future.