SEC Brought a Case Against Telegram Group Inc. Investing Violations Detected

by Margot Bafta

The Securities and Exchange Commission (SEC) lodged a lawsuit against two Telegram Group Inc. offshore companies and its sub-company TON Issuer Inc.

According to the complaint, Telegram Group Inc attracted investments for "various businesses," including the development of the Telegram Open Network blockchain, for "TON" in fact, and the Telegram messenger itself.

The SEC experts stated that neither the company nor investors registered, causing violation of the Securities Act of 1933. One of the SEC's executives, Steward Peikin, said the Durov brothers "messenger"seeks benefits without long-established legal rules." The commission says all the $1.7 billion raised from investors was not registered in the U.S. The complaint was filed as a matter of urgency in Manhattan District Court.

Plus, the co-head of the SEC law enforcement department Stephanie Avakian said that the lawsuit against Telegram is aimed at trying to interfere with the blockchain in the United States:

"Our extraordinary measures are aimed at thwarting Telegram's attempts to fill U.S. markets with digital tokens that we claim were sold illegally."

The SEC was able to temporarily block the release of the blockchain, which should be released to the public by October 31, 2019.