ethereum expert Steven Nerayoff has issued a scathing criticism of the US Securities and Exchange Commission (SEC), following a recent controversy involving the regulatory body and crypto company DEBT Box. Nerayoff's comments, which are steeped in his personal experiences with the SEC, came after Split Capital's Zaheer Ebtikar drew attention to the SEC's alleged misconduct.
Ebtikar criticized the SEC for allegedly inventing risks to obtain a restraining order against crypto company DEBT Box. In the case, federal Judge Robert Shelby recently expressed doubt about the SEC's conduct, suggesting that the agency presented false evidence to freeze DEBT Box's assets.
In July 2023, the SEC charged DEBT Box with offering unregistered securities and defrauding investors of at least $49 million. The SEC's legal team further alleged that the defendants were trying to move investor assets and funds overseas.
ethereum Insider Details Dishonest SEC Practices
In response to these developments, Nerayoff lashed out the SEC, detailing his own legal battles with the agency. “Do you think the SEC's actions in this case were bad? Let me give you a simple look at some of the illegal acts that the SEC committed against me that I discovered. Most of this was presented publicly in my motion that ultimately got the case dismissed after three and a half years,” Nerayoff posted on X.
Nerayoff accused the SEC of conducting a protracted investigation into his activities without any evidence of wrongdoing. “The SEC investigated me for years, often under false pretenses, even though there was no indication of wrongdoing, and found that I did nothing wrong,” Nerayoff said.
He alleged that the SEC, working with the FBI and the Department of Justice, fabricated a crime that led to his prosecution. “The SEC, along with the FBI and the Department of Justice, fabricated evidence to create a crime that never occurred, leading to malicious prosecution against me for three and a half years.”
Furthermore, he claimed that the SEC exceeded its jurisdiction by initiating criminal proceedings against him. “The SEC is a civilian regulatory agency, but it led a (fabricated) criminal case against me, which is outside its scope,” Nerayoff said.
He also highlighted problems with evidence handling, claiming that the SEC withheld critical documents from him. “The documents I requested from the SEC were denied because the DOJ lied in court documents saying that the SEC was not a party to the prosecution,” he added.
Nerayoff's frustrations extended to the SEC's alleged misuse of subpoenas, which he claimed were issued illegally for a criminal matter and then hidden.
He also highlighted the pressure he faced to provide information on other industry leaders:
During my prosecution, led by the SEC, I was under extreme pressure to provide information on industry leaders despite having no reason to believe these individuals had committed any crimes. I was forced to risk decades in prison for refusing to cooperate.
Additionally, ethereum Insider elaborated on another lie by the SEC in its case. “The SEC admits they have 14 Gigs of data on me even though they are supposedly not involved in my case?! Then they say I have to wait at least three years before they will even start reviewing my request for those records! Make it make sense?!?!” Nerayoff expressed his disbelief.
crypto Community Awaits Next Steps
Nerayoff's revelations shed light on the SEC's practices, especially in its dealings with the cryptocurrency industry. As Bitcoinist has reported in recent weeks, Nerayoff's allegations against the SEC, as well as ethereum co-founders Vitalik Buterin and Joseph Lubin, are quite serious, ranging from bribery to frauds bigger than Sam Bankman-Fried's FTX.
Nerayoff is currently reported to be working on fraud allegations against ethereum founders Vitalik Buterin and Joseph Lubin following the release of a 2015 recording that includes a conversation between him and Buterin. This recording demonstrated Nerayoff's important role in the development of ethereum.
At press time, eth was trading at $2,207.
Featured image from YouTube/Web Summit, chart from TradingView.com
