Mango Markets ‘Settles’ Charges With SEC, Pays $700,000 Fine

• Mango Markets settles charges against the SEC by paying a hefty fine of $700,000.
• Further, the token MNGO will be destroyed, and trading of the same will be ceased.
• The SEC stated that the token is an unregistered security offering broker services.

The Mango DAO, along with Mango Labs LLC and the Blockworks Foundation, have agreed to settle the charges with the US Securities and Exchange Commission (SEC) on Friday. As part of the settlement, the entities have collectively agreed to pay a hefty fee of $700,000. Further, they agreed to destroy the token MNGO, stop its trading, and refrain from marketing the tokens to exchanges in the future.

According to an official press release from the SEC, Mango Markets’ token was alleged to be an unregistered security. It had been offering unregistered broker services in connection with various crypto assets. Further, the SEC implied that by deviating from its regulations, investors are deprived of protection.  

The SEC alleged that the Mango DAO, which started in August 2021, had raised over $70 million from unregistered offers and sales of its tokens to investors worldwide, including the US. It added that both Blockworks Foundation and Mango Labs operated as unregistered brokers for Mango Markets. Further, they both facilitated transactions on the Mango Markets platform by handling the customer funds and securities.

In the complaint filed by the SEC, the Mango DAO and the Blockworks Foundation were charged with securities violations offering registration provisions under the Securities Act of 1933. Also, the SEC charged Blockworks Foundation and Mango Labs with broker registration provisions violations under the Securities Exchange Act of 1934. Jorge G.Tenreiro, the acting chief of the Crypto Assets and Cyber Unit, said,

If you engage in securities-intermediary functions, you must register or be exempt from doing so, regardless of the technology employed and the type of legal entity used.

The entities neither accepted nor denied the charges, and the settlements are subject to court approval. Earlier, the Mango DAO held an open vote within its community to suggest whether it should adopt the settlement offer proposal. Nearly 110,796,422 votes were cast in support. 

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