The Ohio Division of Securities added its name to the $22.5 million multistate settlement against the cryptocurrency lending platform Nexo.
US regulators previously alleged the firm failed to comply with local requirements when offering Earn Interest Products (EIP).
Ohio Joins the Club
The watchdog of “the Buckeye State” issued a consent order against Nexo, thus joining other US states that claimed the cryptocurrency firm violated some rules when offering Earn Interest Products (EIP). The company promoted its option via social media channels and on its website to US consumers, saying they could obtain returns as high as 36.
The North American Securities Administrators Association (NASAA) and the SEC insisted that Nexo did not disclose vital information about the products and failed to outline the risks for investors. There were over 2,300 Ohio residents who joined the program as of the end of July 2022 and collectively distributed more than $15 million. Nexo had 93,318 EIP investors in the US who allocated approximately $800 million.
“All financial services companies, including those offering services for crypto assets, must comply with Ohio’s securities laws.
In partnership with NASAA and other state securities regulators, we will continue to protect Ohioans’ investments and ensure that companies operating here follow our securities laws,” Andrea Seidt – Ohio Securities Commissioner – stated.
Nexo agreed to pay $22.5 million to resolve the issues with the regulators of Ohio and the other states, as well as the authorities of Puerto Rico, the US Virgin Islands, and the District of Columbia. It also vowed to cease the offering in Ohio and stop paying interest on all existing EIP accounts on April 1, 2023.
