SEC seeks injunctions against crypto advisors over unissued certificates

The SEC filed 38 civil complaints against crypto advisory firms over certificates that the SEC says were never issued. The defendants include CryptoOrbit, Ftaexchange, Pinnacle, Quantum, RBH Infinity Exchange, THEVGPRO, Apexium Securities, Web3 University, and Absolutaris Base. The SEC seeks injunctions that would impose civil penalties and bar defendants from using reporting exemptions in future advisory filings. The SEC accuses the firms of making materially false statements on Form ADV. The SEC also accuses the firms of failing to file disclosures. The SEC alleges violations of Sections 204(a) and 207 of the Investment Advisers Act. The initial complaints do not quantify investor losses. Quantum Financial Institute allegedly claimed investment adviser registration that did not exist. Quantum also displayed a purported SEC certificate to customers. Ftaexchange allegedly promoted digital asset trading and custody services while claiming false SEC registered investment adviser status. Pinnacle allegedly said it had completed SEC registration when it had not. THEVGPRO allegedly promoted a BTC backed settlement security fund with registration numbers that the SEC had not approved. CryptoOrbit allegedly claimed to possess SEC certificates that the SEC had never issued. SEC staff tried to contact several firms that made false registration claims. Some listed phone numbers were disconnected or belonged to unrelated businesses. Some postal addresses were undeliverable. Several firms claimed Colorado operations despite using Hong Kong IP addresses. Apexium allegedly listed a Colorado office where it had no presence. Web3 University allegedly accessed FINRA's filing system from China and listed a disconnected phone number and an undeliverable Colorado Springs office. FINRA removed non-compliant adviser forms from adviserinfo.sec.gov at the SEC's direction. The Better Business Bureau received complaints about Absolutaris, including worthless stock signals, a fake trading app, and advertisements for monthly returns of 20% to 60%.