On July 8, 2019, the staffs of the U.S. Securities and Exchange Commission’s Division of Trading and Markets and the Financial Industry Regulatory Authority (“FINRA”) issued a joint statement articulating various considerations relevant to questions they had received concerning the application of the federal securities laws and the rules of FINRA to the potential intermediation—including custody—of digital asset securities and transactions. At the outset, the Statement made clear that novel issues have been raised. It…
On Tuesday, September 11, the Financial Industry Regulatory Authority (“FINRA”) took its first disciplinary action against an industry professional, charging a broker, Timothy Tilton Ayre, with securities fraud and the unlawful distribution of an unregistered cryptocurrency security, HempCoin. FINRA’s complaint alleges that Ayre attempted to lure public investment in his public company, Rocky Mountain Ayre, Inc., by issuing and selling HempCoin. Ayre made a host of fraudulent statements about his company’s business and finances, as…