Official announcements from regulatory bodies like the SEC

SEC Charges TrustToken and TrueCoin with Investor Fraud Over TrueUSD, $666,000 Settlement

Sep 24, 2024, 05:53 PM

The U.S. Securities and Exchange Commission (SEC) has charged TrustToken Inc. and TrueCoin LLC with defrauding investors over their stablecoin programs, specifically TrueUSD (TUSD). The SEC alleges that the companies falsely marketed the investment opportunity as safe and trustworthy, claiming that TUSD was fully backed by U.S. dollars. In reality, 99% of the reserves backing TUSD were invested in a speculative offshore fund. TrustToken and TrueCoin have agreed to settle the SEC’s charges without admitting or denying the allegations. As part of the settlement, they will pay $666,000 in penalties, with TrueCoin also paying a disgorgement of $340,000. The alleged fraudulent activities, including investment contracts and unregistered securities, occurred from November 2020 to April 2023. By fall 2022, the majority of TUSD reserves were invested in the offshore fund.