SEC’s Motion Granted to Terminate Sanctions in Blockvest Lawsuit

Gonzalo P. Curial, a Judge at the Southern District Court of California, has recently agreed to the recommendations issued by Honorable Michael S. Berg. These recommendations are in regard to an action brought forth by the US Securities and Exchange Commission, or SEC, against Blockvest LLC and one Reginald Buddy Ringgold, III. Ringgold is also known as Rasool Abdul Rahim El.

False Claims Of Validity Backed By Fake Regulator

This action came in regards to an unregistered ICO that Blockvest had held, with the SEC alleging that the parties involved were selling unregistered securities. Notably, the regulator claimed that Ringgold, the founder and principal of Blockvest, and Blockvest itself had offered and sold unregistered securities, doing so in the form of a digital asset referred to as BLVs. Furthermore, the SEC sought to stop an investment fraud event that involved an initial coin offering or ICO.

The regulator claims that the defendants had falsely claimed that their ICO was both registered and approved by not only the SEC, but other regulators, as well. Further allegations against the defendants are that they went as far as to create a fake regulatory agency. This agency went by the name of the BLockchain Exchange Commission or BEC, and was used to legitimize their currency by creating an impression to investors that it was a safe investment.

Lying To The Court

In January of 2020, the SEC had filed a motion to terminate sanctions, giving the argument that the defendants had willfully deceived the court, doing so in bad faith. This deception was done by filing false and forged declarations in support of their opposition against the SEC’s motion for a preliminary injunction. The regulator asserted that the subsequent discoveries in regards to the filed declarations had revealed that there were critical details obscured.

Particularly, the declarants were unaffiliated individuals, who were simply provided the fraudulent promotional materials by the defendants themselves, as well as their commissioned sales agents. This was done before the investments, and it was discovered that a minimum of four other declarations was done while being knowingly forged or otherwise deceptive.

Deemed To Be In Bad Faith

Back in April of 2020, the Honourable Micheal S. Berg had sided with the SEC. He had found that the submissions of the defendants, alongside the reliance of fraudulent and false declarations, were done willfully, and subsequently constituted bad faith. The filing of the forged statements at issue was consequently a willful action, constituting bad faith, as well.

Honorable Berg considered the forged declarations, the failure to correct or withdraw these declarations, the breadth of the falsehoods in these declarations, as well as Ringgold himself trying to conceal this wrongdoing. After this all was taken int consideration, the Magistrate Judge concluded that the defendants had intentionally presented false evidence to the District Court.

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