There is a God. /r/atheism unsubscribed.
best comment so far
Agreed. That thread is comedy fucking gold.
Welp, it has been a long time coming but the process is finally underway and while this may well be a civil action, the collected evidence they possess will no doubt have been passed to other three-letter agencies.
Of particular interest to them will be the involvement of wealthy-investor-with-banking-difficulties-Rishabh-Jain. After all, Cantor Fitzgerald is a company in the business of providing investment services and advice to high-net-worth individuals and one would have to wonder how he ended up being introduced to the Garzas.
Turns out a bowtie, a rented Diablo, and an entourage of schills can't save you from the SEC. I think this will set the stage for many more SEC actions against the "cloud mining" scammers, at least those with ties to the US:
"Hashlets constitute investment contracts, and thus “securities” under Section 2(a)(1) [15 U.S.C. §77b(1)] of the Securities Act."Anyone who was wondering if cloud mining contracts would be considered securities? The US definitively says yes.
I think you are mistaken. SEC didn't say cloud mining contracts are considered securities. If you read the other paragraphs, they state that they only had a fraction of mining with respect to what they sold. They also talk about paying with other funds, that's what makes it a security. Cloud mining itself isn't really described in there (unless I missed it)
Oh shut up. We all read the same document and the point is there's some actual precedent for the SEC to go after scammers in crypto. The above is a direct quote from the indictment. Whether you call it cloud mining or anything else, they are saying this shit isn't OK and it's not a leap to say that cloud mining shares constitute an investment contract when many of the cloud mining scams promise specific ROI terms and even use the word "contract." It's a legal milestone, like the IRS declaration of crypto as property, and the Breathitt Co., KY ruling against the borrower who defaulted on a BTCJam loan. That's the point.
Not sure why you are being so hostile Phwner, but the SEC finding does not indicate that cloud mining as a whole is an unregistered security. If you think otherwise, perhaps you could post the exact paragraph?
I agree that many cloud mining companies are likely also operating as illegal securities, but that does not mean all. It depends on how they are actually structured and sold.
Back on topic, I posted this long ago, but here are the sentencing guidelines for cases like this:
FIGURE 1: EXAMPLE RECOMMENDED SENTENCING PERTHE GUIDELINES (FOR THE DESCRIBED OFFENSE)
Section Level:
Base Offense Level (Fraud / Non-Fraud White Collar)18 §2B1.1(a) 7
» Loss (between $20 and $50 million) §2B1.1(b)(1) +22
» 250 or more victims §2B1.1(b)(2) +6
» Sophisticated means §2B1.1(b)(10)(C) +2
» Role in the offense §3B1.1 +2
Those are for levels, not months or years. The levels then correspond to a time in jail (this is like D&D hit-charts?), so for level 39 you have: 262 – 327 months (~21.8 – 27.25 years)
Josh is clearly at least level 39, between +7 levels for fraud & +22 for 20 million in loss. Even if that loss proves less, there were more than 250 victims, this is "sophisticated" (even if Josh is not), and he had a clearly prominent role.
Josh is at least level 39-49. That's a lot of time, before good behavior anyway. It is possible to get a life sentence for fraud, even with no past criminal convictions, not that I think Josh deserves to be in prison for life.
