The US Securities and Exchange Commission had filed the documents on Friday against Telegram. The SEC said that the evidence of post-ICO sales incises the company’s argument that the offering was the act of exception from registration requirements.
As indicated by the invoices presented by the Securities and Exchange Commission, the Da Vinci Capital sold over $2 million worth of grams to a fund which is managed by its portfolio firm, ITI Funds, on June 20, 2018. The Gem Limited sold about $8.6 million worth of grams to a company named Goliat Solutions and about $4.5 million to Space Investments Limited on July 2, 2018.
Both sales took place after the offering of grams, that Telegram reportedly maintains, was exempt from registration under Regulation D, which got completed between February and March 2018.
An earlier SEC filing, referring to the invoices, stated –
“These documents undermine Telegram’s claimed affirmative defence that the Offering was exempt under Regulation D. First, Telegram either raised more than the $1.7 billion for which it claimed an exemption, or it did not raise $1.7 billion as of March 29, 2018, and the later funds may have been raised through underwriters.”
The SEC’s argument is that the issuer, under Regulation D, should take reasonable steps to make sure that the purchasers don’t act as statutory underwriters.
Philip Moustakis, a counsel at Seward & Kissel as well as former senior counsel at the SEC, said –
“In this case, the regulator is saying the companies that invoiced Telegram did exactly that, while Telegram argues that the commissions were finders’ fees to non-U.S. persons and entities for introducing grams to other investors.”
The SEC sued Telegram in October last year, ordering it to stop the launch of TON. The regulator is set to meet Telegram in the court on February 18-19.
Meanwhile, the SEC requested full banking records of Telegram about the token sale proceeds. Telegram asked the judge on January 9 to grant the company 5 to 7 weeks to get the documents prepared for avoiding privacy infringement.