Telegram Refuses to Send Crypto-Related Bank Records to the U.S. Securities and Exchange Commission
Cloud-based instant messaging platform Telegram is withholding bank records related to its controversial initial coin offering (ICO) from the U.S. Securities and Exchange Commission (SEC).
On January 2, the SEC filed a court order to force the Telegram Group to divulge bank documents in an effort to discover how the company spent the $1.7 billion raised from investors in two rounds of token sales.
The US regulator states,
“Defendants are now refusing to disclose the bank records concerning how they have spent the $1.7 billion they raised from investors in the past two years and to answer questions about the disposition of investor funds.”
The SEC claims that Telegram conducted an unregistered sale of securities when the encrypted messaging platform launched its multi-billion-dollar ICO in 2018 for the development of its TON blockchain.
While the company tried to prohibit US investors from participating in the token sale, the SEC filed a complaint alleging that 39 US residents were able to obtain $424.5 million worth of Telegram’s Gram (GRM) tokens.
Telegram has accused the SEC of being “unconstitutionally vague.” They say that regulators did not provide sufficient guidelines before and after the ICO.