On July 2, the U.S. Securities and Exchange Commission charged two men with the illegal sale of securities related to UBI Blockchain Internet, Ltd. (“UBIB”). The SEC alleges that T.J. Jesky and Mark F. DeStefano made approximately USD 1.4 million by selling shares in UBIB over a 10-day period in December 2017 and January 2018. The sales stopped when the SEC temporarily suspended trading in UBIB stock earlier this year due to concerns about the accuracy of assertions in its SEC filings and unusual and unexplained market activity.
The SEC’s complaint alleges that Jesky, and DeStefano received 72,000 restricted shares of UBIB stock in October 2017 and were permitted to sell the shares at a fixed price of $3.70 per share under the registration statement. Instead, Jesky and DeStefano unlawfully sold the shares at much higher market prices – ranging from $21.12 to $48.40 – when UBIB’s stock experienced an unusual price spike. Without admitting or denying the allegations, Jesky and DeStefano agreed to return the ill-gotten gains, pay USD 188,682 in penalties, and be subject to permanent injunctions. The settlement is subject to the court’s approval.
The press release that the SEC issued about the case contained another warning to public retail investors to be cautious before buying stock in companies that suddenly claim to have a blockchain business. As we reported earlier, in order to educate the public, the SEC has gone as far as to create a mock website that offered a phony ICO.
