Takeaways from the SEC’s $100M Fine Against FinTech Lender BlockFi, with Brad Rustin

So, apparently this is true:  Running a lending operation without registering with the SEC makes them crabby.

Spoiler Alert: On Valentine’s Day this year the SEC announced a $100 million fine against retail crypto lender BlockFi Lending. Nothing says “will you be mine?” like a nine-figure bill — for  that special someone who has everything. The company agreed to put an end to some of its offers and sales, and to get to work bringing itself into compliance with, you know, the law, like the Securities Act of 1933 and the Investment Company Act of 1940. 

So, what does the SEC want companies to do?  What remedies does the SEC have for unregistered securities offerings?  What impact will this have on private litigation? Is there a risk that BlockFi Interest Account investors will have claims against BlockFi? Want to find out? 

Listen to my interview with attorney Brad Rustin. Brad is a partner in the Greenville, South Carolina, office of Nelson Mullins Riley and Scarborough where he chairs the firm’s Financial Services Regulatory Practice, leading a team of attorneys in a national practice representing clients in financial regulatory and FinTech matters. This is Brad’s third appearance on the podcast! He spoke on one episode about the Impact of the Russia Sanctions on Global Financial Markets, and on another popular episode on the Gamification of Stock Trading. Brad is a valued member of the Editorial Board of Advisors for the Journal on Emerging Issues in Litigation, a companion to this podcast. Want a sample copy? Let me send you one. Write to me at Editor@LitigationConferences.com.

This podcast is the audio companion to the Journal on Emerging Issues in Litigation. The Journal is a collaborative project between HB Litigation Conferences and the Fastcase legal research family, which includes Full Court Press, Law Street Media, and Docket Alarm. The podcast itself is a joint effort between HB and our friends at Law Street Media. If you have comments or wish to participate in one our projects, or want to tell me how much  you learned from Brad,  please drop me a note at Editor@LitigationConferences.com.

Bonus! For those of you who struggle to understand cryptocurrency, like a certain member of my family, listen for the bonus segment after the outro when Brad politely and patiently helps me in my quest to explain crypto to my mother-in-law. And, if I’m being honest, to me, too.