The U.S. Securities and Exchange Commission (SEC) announced the filing of a lawsuit against Kik Interactive Inc. wherein it alleges the Canada-based company sold millions of dollars’ worth of unregistered securities as part of its $100 million initial coin offering (ICO).
The securities regulator says that Kitchener-based company sold the tokens to U.S. investors in 2017 without registering their offer and sale, or providing proper disclosure, as required by U.S. securities laws.
Steven Peikin, co-director of the SEC’s division of enforcement, stated thus while explaining the complaint in a press release:
“By selling $100 million in securities without registering the offers or sales, we allege that Kik deprived investors of information to which they were legally entitled, and prevented investors from making informed investment decisions. Companies do not face a binary choice between innovation and compliance with the federal securities laws.”