The SEC (United States Securities Regulator) is attempting to do a revision of the punishment worth $22Mn that it handed out to LBRY, a decentralized platform for content. The regulatory body acknowledged that LBRY is not likely to produce the funds asked for by the body.
SEC Changes LBRY Punishment To Something More Feasible
On May 12th, the SEC filed an attempt to amend in a Court in the district of New Hampshire. It sought to change the amount it requested as remedial in the LBRY case that was successful. The SEC claimed LBRY profited $22Mn by selling its specialized LBC (LBRY Credits) tokens.
As such, the regulatory body had sought that same amount as a civil penalty. Now, the Commission is asking for a $111,614 imposition because of the almost defunct state of LBRY as well as its absence of funds. The Commission further removed the different disgorgement request for $22Mn. These were the same funds that the regulatory body stated that LBRY must pay back since they were illegally acquired through the sale of LBC.
The Commission request further asks the court to prevent LBRY from carrying out unregistered offerings in the future of securities of crypto assets. In the court filing, the Commission acknowledged the representation of the LBRY being defunct, stopping operations as well as being unable to pay the larger fine. As such, the commission also admits that the payment ability of the defendant is an issue to consider during a civil penalty imposition.
The first Commission civil lawsuit against LBRY was filed in March 2021. It alleged that the LBC sales carried out by the firm were securities offerings that were unregistered. The total remuneration asked for was $44Mn which would be split evenly between a disgorgement and civil penalty.