SEC formally sues "fake blockchain company" Longfin, Nasdaq has terminated its stock trading

The U.S. Securities and Exchange Commission (SEC) has formally filed a lawsuit against Longfin Corp., whose shares jumped 2,000 percent after announcing the acquisition of a blockchain startup late last year.

Local time this Friday (April 6), the US Securities and Exchange Commission said that Longfin Corp. CEO Venkata Meenavalli and three other personnel were suspected of selling shares after the stock price rose last December.

According to relevant statements, Longfin issued more than 2 million unregistered restricted shares to Amro Altahawi, and issued tens of thousands of restricted shares to Dorababu Penumarthi and Suresh Tammineedi, all of whom appeared in the U.S. List of lawsuits brought by the Securities and Exchange Commission.

According to law enforcement agencies:

“The SEC said Amro Izzelden"Andy"Altahawi, Dorababu Penumarthi and Suresh Tammineedi illegally sold a large number of restricted shares of Longfin Corporation to the public in the face of the subsequent substantial increase in the stock price. Altahawi, Penumarthi and Tammineedi collectively made more than $27 million in profits from their sales. "

The SEC also announced Friday that it had obtained a court order imposing a freeze on the $27 million in stock proceeds.

In the "blockchain boom" last year, Longfin was one of many start-up companies whose stock prices skyrocketed with the concept of blockchain. According to market data released by Google, in December last year, Longfin's stock price once exceeded $70, but its stock price is currently hovering around $28, whileShortly before the SEC announced the lawsuit, Nasdaq had indicated that Longfin’s shares had been suspended from trading.