SEC Lowers Initial Punishment of $22 Million Against LBRY to $111,000
In Brief
The SEC originally wanted LBRY to pay millions of dollars in penalties, but the company is unable to pay that much now.
LBRY‘s failure to pay millions in SEC penalties has prompted the regulator to revise the fine due to the lack of funds, the SEC said on Friday.
In a May 12 filing in a New Hampshire District Court, the Securities and Exchange Commission (SEC) sought an amendment to its request for remedies in its successful case against LBRY.
The SEC requested that the court fine LBRY $111,614 for “lack of funds and near defunction.” Instead of seeking the original $22 million — the amount LBRY claims it gained from the sale of LBRY Credits (LBC), the SEC has asked the court to impose a fine of $111,614, citing LBRY’s “lack of funds and near defunct status.”
The Commission agrees with LBRY’s assertions that it is defunct, it has ceased operations and is unable to pay a larger fine, it said in the filing.
In March 2021, the SEC filed a civil lawsuit against LBRY, alleging the firm’s LBC sales were unregistered securities offerings. The court must order LBRY to halt future sales of LBC shares, the court ruled.
In a December filing, LBRY claimed that the SEC’s request for $22 million wasn’t reasonable as it was “vastly” overstated and failed to “deduct any of LBRY’s legitimate business expenses.” According to LBRY, the SEC’s calculation of the amount was “based on rough, back of the envelope math” and the amount it sought was “simply not supported by the record.”
The LBRY lawsuit was a month prior to the announcement that the SEC had won the case, and the company was “likely dead in the near future” as a result, according to LBRY in December 2022.
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Nik is an accomplished analyst and writer at Metaverse Post, specializing in delivering cutting-edge insights into the fast-paced world of technology, with a particular emphasis on AI/ML, XR, VR, on-chain analytics, and blockchain development. His articles engage and inform a diverse audience, helping them stay ahead of the technological curve. Possessing a Master's degree in Economics and Management, Nik has a solid grasp of the nuances of the business world and its intersection with emergent technologies.
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Nik is an accomplished analyst and writer at Metaverse Post, specializing in delivering cutting-edge insights into the fast-paced world of technology, with a particular emphasis on AI/ML, XR, VR, on-chain analytics, and blockchain development. His articles engage and inform a diverse audience, helping them stay ahead of the technological curve. Possessing a Master's degree in Economics and Management, Nik has a solid grasp of the nuances of the business world and its intersection with emergent technologies.
