United States District Judge Robert Shelby has cautioned the Securities and Exchange Commission (SEC) lawyers, hinting at possible sanctions due to purportedly deceptive statements in a legal action against Digital Licensing Inc., also recognized as DEBT Box, a crypto company.
Lodged in the federal court of Utah, the SEC’s legal action alleged that DEBT Box deceived investors by around $50 million via the vending of unregistered securities known as “node licenses.”
Judge Shelby’s decision revealed notable discrepancies in the SEC’s case. Initially, the SEC, led by attorney Michael Welsh, had convinced the court to freeze DEBT Box’s assets, arguing the company was moving to Dubai, beyond U.S. regulatory reach. Subsequently, it was discovered that these assertions were inaccurate, with no bank account closures and an alleged overseas transfer of $720,000 being domestic.
The judge raised apprehensions regarding the behavior of the SEC lawyers. Misrepresenting facts and the failure of other team members to rectify these inaccuracies may have violated federal court Rule 11(b), which mandates evidence-backed factual claims. This resulted in the issuance of a “show cause order” by Shelby, requiring the SEC to provide reasons why they should not incur penalties for these actions.
The intricacy of the case is underscored by a TRM Labs report corroborating the SEC’s primary claim that DEBT Box deceived investors regarding mining tokens. The defense counsel has not provided a statement on the issue, and the SEC has acknowledged the order, planning to respond within the two-week timeframe specified by Judge Shelby.
This milestone signifies a pivotal moment in the legal process, highlighting the complexities of cryptocurrency regulation and underscoring the significance of legal responsibility in high-stakes financial litigation.
Ripple lawyer John E. Deaton says he is not surprised that the financial regulator has been caught lying, adding, “It appears the lawyers at the SEC have made it personal when it comes to crypto cases.” With this, he calls for a subpoena against the financial watchdog. His colleague, Ripple chief technology officer Stuart Alderoty has also listed a detailed analysis of troubling patterns seen with the SEC.
And they’re off! Bridget Phillipson was first away in her two-horse race with Lucy Powell in the Labour deputy leadership stakes.
Facing a rival who was sacked from the government nine days earlier, the education secretary said the deputy leader should be a cabinet minister, as Angela Rayner was.
Launching her campaign at The Fire Station, a trendy music and entertainment venue in Sunderland, she also vowed to turn up the heat on Nigel Farage and Reform UK.
She also repeatedly called for party unity, at a time when Labour MPs are growing increasingly mutinous over Sir Keir Starmer’s dealings with sacked Washington ambassador Lord Mandelson.
Despite Ms Phillipson winning 175 nominations from Labour MPs to Ms Powell’s 117, bookmakers StarSports this weekend made Ms Powell 4/6 favourite with Ms Phillipson at 5/4.
But though the new deputy leader will not be deputy prime minister, a title that’s gone to David Lammy, Ms Phillipson praised the way Ms Rayner combined the two roles and rejected suggestions that as a cabinet minister she would be a part-time deputy leader.
“What can be achieved under a deputy leader with a seat at cabinet, just look at Angela Rayner,” Ms Phillipson told her enthusiastic supporters.
“Angela knew the importance of the role she had. There was nothing part-time about her deputy leadership.
“Last year I campaigned up and down the country to get Labour candidates elected – I’ve not stopped as education secretary – and I won’t stop as deputy leader.
“Because with local elections, and with elections in Wales and Scotland right around the corner, that role is going to be more important than ever.
“So that’s why, today, I pledge to continue Angela Rayner’s campaigning role as deputy leader.
“Continuing her mission to give members a strong voice at the cabinet table.
“Her ruthless focus on getting our candidates elected and re-elected, alongside her total determination to drive change from government. Because what mattered was not just what she believed, but that she could act on it.”
Ms Phillipson pledged to run a campaign of “hope, not grievance” and claimed the party descending into division would put the chances of children and families benefiting from Labour policies at risk.
But admitting Sir Keir Starmer’s government had made mistakes, she appealed to party members: “You can use this contest to look backward, to pass judgement on what has happened in the last year, or you can use it to shape positively what happens in the run-up to the next election.
“Back me so I can unite our party, deliver the change we want to see and beat Reform. Back me so together, we can deliver that second term of Labour government.”
Image: Phillipson with Labour supporters at her campaign launch on Sunday. Pic: PA
Starmer’s candidate vs Manchester mayor’s
As she did in a speech at the TUC conference last week, Ms Phillipson spoke about her upbringing “from a tough street of council houses in the North East all the way to the cabinet”.
At the TUC, she said she grew up – “just me and my mam” – and told how when she was nine, a man who’d burgled the house turned up at the front door with a baseball bat and threatened her mother.
Ms Powell, who enjoys the powerful backing of Labour’s ‘King of the North’ Andy Burnham, called this weekend for a change in culture in 10 Downing Street, with better decisions and fewer unforced errors.
His backing has led to the deputy contest being seen as a battle between Sir Keir’s candidate, Ms Phillipson, and that of the Greater Manchester mayor, seen increasingly as a leadership rival to the prime minister.
And like all the best horse races, with the betting currently so tight, when the result is declared on 25 October the result could be a photo-finish.