Busted: SEC Charges Blockchain Marketplace Founder Sergii “Sergey” Grybniak for Fraudulent ICO 2017

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    The US Securities and Exchange Commission (SEC) has charged former Stevie Award winner and SEO champion Sergii “Sergey” Grybniak and his company Opporty International, Inc. – a blockchain marketplace company with conducting a fraudulent initial coin offering (ICO) of unregistered digital asset securities.

    As alleged in the SEC's complaint, it raised approximately $600,000 from nearly 200 investors in an Initial Coin Offering (ICO) of what the SEC claim were Opporty's unregistered digital asset securities called “OPP Tokens.”

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    Grybniak pitched Opporty’s platform as a place where SME's could list their services and products, and use blockchain smart contracts to enter into agreements with customers using OPP Tokens. Grybniak apparently sold the tokens using a SAFT (Simple Agreement for Future Tokens) agreement and thought he was safe legally. 

    But the real problem was with Grybniak allegedly made multiple false and misleading statements to investors, including exaggerating the number of actual and potential users of its business platform – falsely claimed to potential ICO investors that Opporty had “onboarded” thousands (as many as 6000+) of verified providers willing to do business on, and contribute content to, Opporty's blockchain-based platform. And he falsely claimed that the ICO was “SEC-regulated,” “SEC-compliant,” and “SEC-registered.”

    The SEC's complaint further alleges that Grybniak and Opporty engaged in other deceptive acts, including misappropriating third-party content without approval or attribution, to create the false impression that actual users of Opporty's platform had created such content.

    The SEC's complaint charges Grybniak and Opporty with violating the antifraud provisions of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities and Exchange Act of 1934 and Rule 10b-5 thereunder, and the registration provisions of Sections 5(a) and (c) of the Securities Act, and also charges Grybniak with aiding and abetting Opporty's violations. The SEC seeks permanent injunctions, conduct-based injunctions prohibiting the offering of digital or other securities, disgorgement plus interest, and civil penalties against Grybniak and Opporty, as well as an officer-and-director bar against Grybniak. The complaint also names Clever Solution Inc., another entity controlled by Grybniak, as a relief defendant.

    The SEC's investigation was conducted by Mark Oh and Kendra Kinnaird, and was supervised by Fuad Rana and Anita B. Bandy of the SEC's Washington, D.C. office, in coordination with the SEC's Cyber Unit. The litigation will be handled by Nick Margida and supervised by Tom Bednar.


    Also published on Medium.

    Busted: SEC Charges Blockchain Marketplace Founder Sergii "Sergey" Grybniak for Fraudulent ICO 2017
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