US SEC and Longfin settle dispute with $400,000 settlement

According to an official statement released by the United States Securities and Exchange Commission (US SEC), CEO of the fintech company Longfin, Venkata Meenavalli, has put an end to the long-standing legal scuffle by agreeing to pay settlement charges of four hundred thousand US dollars ($400,000).

All hell broke loose when Longfin stock prices skyrocketed, back in 2017, and peaked over one thousand percent (1000%), prompting investors and the US SEC to dig deeper into Meenavalli’s investments and company operations. As soon as the official investigation kick-started, the company shares plunged by thirty percent (30%).

Longfin’s long-standing legal battle with US SEC comes to an end

As per the US SEC’s complaint, Meenavalli had ticked all the wrong boxes. Besides qualifying for Regulation A+ using unethical tactics such as misrepresenting public filings and misquoting that the company is based and operating from the US, Longfin is also accused of attaining Nasdaq listings unlawfully and distributing four hundred thousand company stocks to affiliates, as per SEC’s complaint.

The US federal agency alleged that Meenavalli misinformed his investors regarding public and Nasdaq listing, thus causing the company to get blacklisted from Nasdaq in early 2018 and officially ceasing its operations later that year. It also stated that over ninety percent (90%) of the firm’s revenue was generated through fabricated commodities transactions.

The complaint was then concluded with a three and a half million US dollars ($3.5 million) disgorgement and over three million US dollars ($3.2 million) penalty. The recent settlement, although awaiting court approval, marks the closure of the SEC’s allegations against Longfin.  

Following court approval, Meenavalli will be required to shell out an amount close to one hundred and sixty thousand US dollars ($159,000), which is equivalent to his income, along with a civil fee of two hundred and thirty-two thousand US dollars ($232,000). Moreover, an official legal suit by the US Attorney at New Jersey will remain open.

Meanwhile, Anita Bandy, Associate Director at the Division of Enforcement, lauds her team for prompt and efficient actions taken against Meenavalli, exposing his wrongful deeds, and preventing other investors from falling prey to his lies.

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