A record number in terms of financial compensation

The US Securities and Exchange Commission (SEC) announced in its annual report that it recorded a 3% increase in enforcement actions during fiscal year 2023 (FY2023), compared to the previous number recorded in fiscal year 2022.

These actions included prominent individuals in the cryptocurrency sector, where charges ranging from fraud to securities violations were brought against several companies and industry executives.

FY 2023 saw a rise in legal proceedings, reaching 784 cases, compared to 760 cases in FY 2022.

As a result of these procedures, the Authority was able to secure $4.949 billion in financial compensation.

Of this amount, $3.4 billion was default interest and prejudgment interest, while civil penalties amounted to $1.580 billion.

The Authority indicated that the financial compensation required in the fiscal year 2023 is the second highest in its history, after recording a record of more than $6 billion in the previous fiscal year.

In addition, $930 million was distributed to affected investors, making it the second year in a row that the authority distributed more than $900 million.

Whistleblower awards have also seen a rise, with $600 million awarded in one year, with the largest single reward in the program's history recorded at $279 million.

As we noted, the authority showed a firm stance towards the cryptocurrency industry in fiscal year 2023, as it filed charges against prominent individuals and entities in this sector, on charges ranging from fraud to securities violations.

Notable cases included charges against FTX founder Sam Bankman-Fried and other executives at the collapsed trading platform, as well as Terraform Labs and its founder Do Kwon.

The authority also charged “Richard Hart” and his three entities, “Hex,” “PulseChain,” and “PulseX,” with fraud and selling unregistered securities.

The authority sparked controversy by accusing major entities such as Binance and its CEO, Changpeng Zhao, and Coinbase, who denied the accusations and sought to dismiss the lawsuits filed against them.

The report also pointed to cases of illegal promotion of securities in the field of cryptocurrencies by celebrities who did not disclose that they received money for these promotions, and these cases included settlements with “Ne-Yo,” “Lindsay Lohan,” “Jake Paul,” and “AKON.” , and “Soulja Boy.”

However, the report neglected to mention the authority’s initial loss in its case against Ripple, where the judge ruled that secondary sales of XRP did not constitute an offer for investment contracts or securities.

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