By George Ward
The New York Attorney General Letitia James has filed a 38-page petition in the New York Supreme Court. The filing claimed that CoinEx had committed “continuous fraudulent practices” and violated the Martin Act.
This act is among the most stringent securities and anti-fraud regulation laws in the United States. James claimed that the company falsely portrayed itself as an exchange by neglecting to register as a commodities and securities provider in the state.
New York’s Attorney General Accuses Of Selling Securities
James stated that CoinEx listed multiple tokens categorized as securities and commodities, such as AMP, Rally (RLY), LBRY Credits (LBC), and Terra LUNA. Additionally, James pointed out that CoinEx did not register with the Commodity Futures Trading Commission or Securities and Exchange Commission.
Hence, it has no license to offer these tokens. “Our aim is to safeguard New Yorkers from the potential hazards of the cryptocurrency industry. Therefore, we are taking action to prevent @coinexcom from conducting business in New York. We will continue to prioritize the protection of our people,” the AG tweeted.
“The days of cryptocurrency firms such as CoinEx operating like they are above the law are numbered,” James added. Per the petition, CoinEx did not comply with the AG’s Office’s subpoena issued on December 22nd to provide info about its crypto trading activities.
Also, the document reveals that the court ordered CoinEx to appear for an examination under oath on January 9th, 2023. However, the company failed to show up. James considered the non-appearance of CoinEx as prima facie evidence of its involvement in the fraudulent practices mentioned.
James Ask Court To Ban CoinEx From Operating In New York
The petition requests a court order to prohibit CoinEx from promoting itself as an exchange and operating within the state. Furthermore, a section asks the court to enforce geo-blocking measures on GPS location data and internet addresses coming from New York.
Meanwhile, Maxine Waters, a California representative and ranking member of the House Financial Services Committee in the United States, has urged collaboration and coordination among legislators and government agencies to tackle the issue of regulating cryptocurrency.
According to Waters, the recent regulatory actions taken by the U.S. SEC and CFTC in the crypto industry could be seen as an attempt to create the perception that they are taking “substantive and meaningful” steps following the FTX saga.
-Furthermore, the representative stated that the market crash and resulting bankruptcies of significant companies presented an opportunity for U.S. lawmakers to ensure accountability in the cryptocurrency industry.