Fresh off yesterday's suit the U.S. Securities and Exchange Commission filed against Kik, the agency is staying active with a fraud action against LongFin Corp and its CEO.
In a press release the SEC claims LongFin and its CEO, Venkata S. Meenavalli, organized a fraudulent Regulation A+ public offering of LongFin shares by falsely representing information in filings submitted to the SEC. The charges claim Meenavalli committed accounting fraud by recording more than $66 million in false revenue, almost 90% of its total reported revenue in 2017.
The SEC also alleges that LongFin consultant Andy Altahawi misrepresented information to Nasdaq, such as number of shareholders and total shares sold in the offering, in order to get shares listed. It also groups two affiliated individuals, Dorababu Penumarthi and Suresh Tammineedi, as participating in the alleged scheme with Meenavalli who the agency claims illegally sold more than $33 million of LongFin stock in unregistered transactions.
The other three named letter besides CEO Meenavalli have agreed to settlements, subject to court approval.
Conducting its IPO and listing on Nasdaq in December 2017, LongFin (LFIN) saw its shares surge more than 2,500% shortly after announcing in a press release that it had bought “a blockchain-empowered global micro-lending solutions provider” that transacts only in cryptocurrencies.