Telegram Resists the SEC Court Order to Reveal Financial Details of 2018 ICO
Drishti Bhagat Jan 03, 2020 10:30
Telegram’s blockchain launch of TON faces delays as the recent court order by US Lawmakers requires the company to hand over documentation regarding the spending of their raised funds via ICO.
A recent court filing initiated by the United States Securities and Exchange Commission (SEC) compels Telegram to reveal bank records and other transactional documents showing how the raised funds have been used in the last two years.
The filing stated: “Plaintiff respectfully moves to compel Defendants to answer questions and provide documents regarding the amounts, sources, and use of funds raised from investors in connection with the unregistered sale of securities at issue in this case, Defendants are now refusing to disclose the bank records concerning how they have spent the $1.7 billion they raised from investors in the past two years and to answer questions about the disposition of investor funds.”
In the early sale rounds in 2018, Telegram raised $1.7 billion for the development of its TON blockchain. It is worth noting that the company advised investors against participating in the rounds, yet many of them were able to access the tokens through external parties before the launch of Telegram’s blockchain.
The SEC summoned the company to court for alleged claims that the tokens fell under the category of securities, which the company failed to make known to the regulators. As a result of this lawsuit, the company has equally been compelled to delay the release of its blockchain launch.
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