The supervisory authorities of the 25 US states involved in the settlement of the lawsuit against the crypto-lender Abra have agreed to waive a monetary fine of $250,000 per jurisdiction in order to facilitate the repayment of the company's total debt to its customers. In turn, Abra and its founder William Barhydt pledged to return virtual assets totaling up to $82.1 million to consumers within the established time frame.
In addition, Barhydt agreed that he would not hold management positions or participate in any other capacity in the business related to money transfer or the provision of monetary services, except as a passive investor, for five years.
"State financial regulators take their role in protecting consumers and preventing unlicensed activity seriously. Companies that do not comply with state laws will certainly be held accountable," said Charlie Clark, Chairman of the Conference of State Banking Supervisors (CSBS), and director of the Washington State Department of Financial Institutions.
Recall that the investigation of the activities of the crypto-lender Abra was initiated by the U.S. Securities and Exchange Commission (SEC) and the U.S. Commodity Futures Trading Commission (CFTC) in 2020. Regulators found that Abra and its affiliated Philippine company Plutus Technologies sold cryptocurrency securities swaps to American clients without registration, which violated U.S. securities laws.
Later, a working group of financial regulators from Arkansas, Connecticut, Georgia, Ohio, Oregon, Texas, Vermont and Washington State joined the investigation. During the investigation, the facts of unlicensed provision of services for buying, selling, trading and investing in digital assets through mobile applications were confirmed.