The US SEC has indicted three people who allegedly carried out insider trading related to the Long Blockchain company in 2017. One of the people allegedly traded shares before the name change that gave the company a price increase. The other two people were informed and took advantage of the data to negotiate accordingly, according to the US regulator. Long Blockchain, formerly Long Island Iced Tea, has made big gains from rebranding, capitalizing on the growing popularity of blockchain.
SEC pursues three over long blockchain insider trading
The Securities and Exchanges Commission (SEC) accuses three people who allegedly profited from Long Blockchain’s name change in 2017. The lawsuit claims the three people took advantage of inside information and traded shares before the famous rebranding. Among these is Eric Watson, who the complaint claims was responsible for the rebranding program. Watson reportedly informed Oliver Barret-Lindsay, a friend and broker, of the brand changes.
Barret-Lindsay also gave the information to another friend, Gannon Giguiere, about the rebranding event. Giguiere put his hands to work and bought 35,000 shares, making over $ 160,000 in profit. Barret-Lindsay and Giguiere are already facing litigation for allegedly organizing a stock manipulation scheme linked to a medical company.
Richard Best, director of the SEC’s New York office, noted:
The SEC remains committed to preventing all types of fraudulent conduct in connection with so-called “crypto” companies, including profiting from the trading of material non-public information.
A linchpin of crypto iced tea
Long Blockchain is one of a select group of companies that capitalized on the blockchain craze that occurred in 2017. Many sports, clothing and other companies have changed their names to be more attractive. for the public. Long Island Iced Tea (LIIT) has announced that it will pivot its business model towards blockchain-related activities. However, it hasn’t made any deals or released any blockchain-related products since the rebranding.
The company’s shares rose 289% in a single day, giving Long Blockchain (LB) investors a good profit. Eric Watson was the company’s largest shareholder, owning 13% of the shares. The happiness did not last long, however. The SEC delisted its shares from the stock markets last February. According to the regulator, Long Blockchain has not filed financial reports for several years. The last LB report filed with the SEC was in 2018.
This is the first action the SEC has taken against companies that rebranded during this time. Other actions could be taken on other companies that have organized similar pivots and rebranding.
What do you think of the SEC’s actions against Long Blockchain? Tell us in the comments section below.
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