As per the latest reports, the New York Attorney General (NYAG) has successfully achieved victory against Coinseed. Coinseed is a cryptocurrency exchange that had been operating in the United States and was involved in somewhat dodgy activities.
The sources have revealed that the cryptocurrency exchange had been carrying out unusual activities involving Dogecoin (DOGE). Through its activities involving DOGE, the exchange was allegedly defrauding its customers.
However, the Attorney General of New York had decided to bring a stop to the fraudulent activities of Coinseed. Therefore, the Attorney General of New York gave orders to deal with Coinseed swiftly. The orders from the New York Attorney General against Coinseed were given on Monday, September 13, 2021.
The name of the NYAG is Letitia James, who ordered that Coinseed’s operations in the cryptocurrency space should be halted with immediate effect. Letitia James ordered the exchange can no longer operate as it is involved in running a fraud.
Apart from orders to halt operations for the cryptocurrency exchange, the NYAG has also imposed a fine of $3 million on Coinseed. The fine has been imposed on the exchange for being dodgy and defrauding a large number of investors.
The report suggests that the Coinseed exchange had shut down the withdrawal access for the users. The exchange not only froze the withdrawal activity of the users, but it also proceeded with converting investors’ funds to Dogecoin. In the report against Coinseed, it was claimed that Coinseed was involved in converting investor funds to DOGE without even getting the consent of users.
Apart from defrauding the investors, the exchange even emptied and closed its own bank account, where it was accumulating all the funds from the investors. The report also suggests that Coinseed was involved in providing unregistered securities/services to US citizens.
This is not the first time Coinseed has been issued with an order by the NYAG Letitia James. In the past, James had issued somewhat of a lighter order against the exchange for ceasing its illegal security distribution activities.
At that time, James had announced that the exchange must stop all its illegal and unregistered operations involving the selling of securities. However, the exchange completely ignored the order and carried on providing illegal/unregistered services to the US investors.
The case had been ongoing since then and the NYAG was deciding on what it was going to do with the case. Therefore, the final verdict has been given against the exchange to shut it down completely.
When the court first took an action against the exchange back in June of 2021, it went ahead acquiring a stay order so it could continue operating. However, the exchange has now dug its own grave by not complying with the regulations.