The Securities and Exchange Commission in the U.S. announced on August 20th, that Russian entity ICO Rating has agreed to pay $268,998 to settle charges that it failed to disclose payments received from issuers for publicizing their digital asset securities offerings.

The SECโ€™s order found that between December 2017 and July 2018, ICO Rating produced research reports and ratings of blockchain-based digital assets, including โ€œtokensโ€ or โ€œcoinsโ€ that were securities, and published this content on its website and on social media.

ICO Rating billed itself as โ€œa rating agency that issues independent analytical research,โ€ and stated that its mission is โ€œto help the market achieve the necessary standards of quality, transparency, and reliability.โ€ However, ICO Rating failed to disclose that it was paid by certain issuers whose ICO offerings it rated.

โ€œThe securities laws require promoters, including both people and entities, to disclose compensation they receive for touting investments so that potential investors are aware they are viewing a paid promotional item,โ€ said Melissa Hodgman, Associate Director of the SECโ€™s Enforcement Division.ย ย โ€œThis requirement applies regardless of whether the securities being touted are issued using traditional certificates or on the blockchain.โ€

The SECโ€™s order finds that ICO Rating violated the anti-touting provisions of Section 17(b) of the Securities Act of 1933.

Without admitting or denying the SECโ€™s findings, ICO Rating agreed to cease and desist from committing or causing any future violations of these provisions, to pay disgorgement and prejudgment interest of $106,998, and a civil penalty of $162,000.



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