Sparkster Will Compensate Harmed Investor Fund With $35 Million

Sparkster Will Compensate Harmed Investor Fund With $35 Million
  • Sparkster and its CEO, Sajjad Daya, have reached an agreement with the SEC.
  • Sparkster has been ordered by the SEC to pay $35 million into a fund for distribution to harmed investors.

The Securities and Exchange Commission (SEC) issued a cease-and-desist order against Cayman Islands-based software company Sparkster and its CEO, Sajjad Daya, on Monday for the unregistered offer and sale of crypto asset securities from April 2018 through July 2018. 

According to the SEC order, Sparkster and Daya raised $30 million from 4,000 investors in the United States and internationally by creating and selling crypto asset securities known as SPRK tokens to fund the development of Sparkster’s no-code software platform. 

Sparkster will pay $30 million in disgorgement, $4.6 million in prejudgment interest, and a $500,000 civil penalty. The firm also agreed to destroy its remaining tokens, withdraw its tokens from any trading platforms, and publish the SEC’s decision on its website. Daya will also pay a $250,000 civil penalty. 

Charges Against Ian Balina Too

Charges have also been brought against crypto influencer Ian Balina for failing to declare money he received from Sparkster for publicly advocating its tokens and for failing to file a registration statement with the SEC for Sparkster tokens that he resold. From around May through July 2018, Balina purchased $5 million in SPRK crypto tokens and promoted them on YouTube, Telegram, and other social media platforms, as per  SEC.

The crypto influencer also allegedly organized an investing pool of at least 50 persons to whom he offered and sold the unregistered tokens. While Sparkster’s SEC settlement was quick, Balina’s allegations may take longer to resolve.

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Journalism graduate who loves to write and Karate. And I love exploring new concepts and that brought me into the fascinating crypto and blockchain technology…