B. Riley and Nomura involved in deal

The U.S. Securities and Exchange Commission (SEC) is investigating investment bank B. Riley over transactions involving Brian Kahn, an alleged co-conspirator in the securities fraud. Nomura Holdings was also involved in the deal. Bloomberg reported on the 22nd.

The background is that John Hughes, co-founder of hedge fund Prophecy Asset Management, which collapsed in 2022 and pleaded guilty to securities fraud in November 2023, has named Khan as one of his co-conspirators. Ta.

The SEC is scrutinizing Khan’s role in last year’s acquisition of retailer Franchise Group (FRG). B. Riley had apparently arranged this transaction. Mr. Khan had pledged some of his assets as collateral for the deal.

Nomura Holdings also provided partial funding to help finance the acquisition, according to a report obtained by Bloomberg. The report also says the investigation is in its early stages and Nomura is not the focus of the investigation.

Nomura led a co-financing of about 89 billion yen ($600 million) to B. Riley to support Mr. Khan’s acquisition, and provided about 35.6 billion yen ($240 million) to support Mr. Khan’s acquisition, according to people familiar with the matter. He is said to have provided it.

Investors looking to short sell B. Riley’s stock are also paying close attention to these developments. B. Riley issued the following statement:

The company also went on to say that it was not aware of any reported SEC investigations, but would fully cooperate with them if they were to occur.

B. Riley is known to have invested heavily in crypto asset (virtual currency) mining companies.

For example, in March 2023, a U.S. court awarded B. Riley Commercial Capital approximately 10.4 billion yen ($70 million) to help restructure Bitcoin (BTC) mining company Core Scientific, which had filed for bankruptcy. Approved to provide financing.

connection: US cryptocurrency mining company Core Scientific emerges from bankruptcy

Nomura Holdings’ Web3 business

Nomura Holdings is also known to be actively working on Web3.

In recent developments, on the 10th, digital asset subsidiary Laser Digital Holdings launched Libre, a Web3 infrastructure for institutional investors. The plan is to proceed with the tokenization of real assets (RWA).

The Libre platform is built using Polygon’s (MATIC) Chain Development Kit (CDK).

connection: Nomura’s Laser Digital announces new tokenization platform “Libre”

connection: Virtual currency exchange OKX partners with Komainu, founded by Nomura HD and others

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