SEC fines Coinme, the bitcoin ATM provider, nearly $4 million

The U.S. Securities and Exchange Commission (SEC) settled a dispute with Coinme, its subsidiary Up Global SEZC, and the CEO of both firms, Neil Bergkvist. The press release states.

The regulator alleged that the defendants conducted an unregistered securities offering in the form of the UpToken (UP) token from October 16 to December 15, 2017, and engaged in misrepresentations to investors.

“[…] Bergkvist and Up Global, without investors’ knowledge of UpToken, took steps before and during ICO to obtain an inventory of UP, which would have substantially reduced Coinme’s need to buy UpToken after the ICO, and consciously or recklessly inflated the sums raised,” the SEC stressed.

Coinme, Up Global, and Bergkvist did not admit or deny the Commission’s findings. However, they agreed to a civil penalty of $3.52 million. The provider will pay $250,000 separately, and the top executive $150,000. He is also barred from serving as an officer or director of a public company.

In September 2019, Coinme, based in the United States, raised $1.5 million. The round included Ripple’s investment arm Xpring and the Blockchain Finance Fund.

In 2021 the provider became a partner of MoneyGram’s money-transfer service and deployed bitcoin ATMs at Walmart stores.

In March 2023, Titanium Blockchain Infrastructure Services CEO Michael Alan Stollery was sentenced to four years in prison for a $21 million ICO fraud scheme.

Earlier, the SEC charged Thor Technologies and its executives in an unregistered securities offering of $2.6 million.