The Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), the two regulatory bodies in the US have <a href="https://www.sec.gov/news/press-release/2020-153" target="_blank" rel="nofollow noopener">charged</a> the crypto investment firm Abra Inc for offering unregistered securities-based swap transactions.

While agreeing to cease-and-desist orders, the California based company and its associated firm Plutus Technologies Philippines Corp have decided to settle the issue by paying $300,000 to both the US regulatory bodies.
<h2>Abra Issues Contracts</h2>
The app offered by Abra provides the services of traditional crypto exchanges to its customer. But earlier, along with this, the app also helped them in purchasing those contracts which indicate the price movement of stock and exchange-traded funds.

However, according to SEC and the CFTC, Abra was not registered under the law where it could allow its customer to purchase contracts, therefore, the regulatory bodies considered this move to be illegal.

On July 14, the SEC released a public statement, in which it mentioned that Abra started issuing pegged contracts to the investors in February 2019. And while doing so, it did not even determine whether the investors were ‘eligible contract participants’ or not.
<h2>Unregistered App Of Abra</h2>
In the same month, the SEC ordered the company to stop providing its contract services to the customers. Abra followed the orders and stopped its services for a few months but then in May 2019, the company again resumed its services. However, soon the regulatory body again passed another order to cease its services for the non-US citizens.

Although the <a href="https://www.cryptoknowmics.com/news/bitcoin-mining-firm-hut8s-106-stakes-obtained-by-fidelity-investment/" target="_blank" rel="noopener">crypto investment firm</a> stops providing its services to non-US citizens and established Plutus in the Philippines, the SEC was still not happy with Abra. The SEC claimed that the app offered by Abra was still not registered with any regulatory body in the US.

Regarding this, the chief of the SEC enforcement division’s Complex Financial, Daniel Michael, said, “Businesses cannot ignore the registration requirements designed to provide investors with the information necessary to evaluate securities transactions.”

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Abra Pays Penalty Of $300K To Regulators For Illegal Swapping

The SEC and the CFTC have charged the crypto investment firm Abra Inc for offering unregistered securities-based swap transactions.

Jyoti is a graduate from GGSIPU and has done her PG Diploma in English Journalism from IIMC. Presently, she is working as a content writer with Agio Support Solution Pvt. Ltd. Her aim is to provide informative content about cryptocurrency and blockchain, to the tech-enthusiasts.

Abra Pays Penalty Of $300K To Regulators For Illegal Swapping

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