SEC Charges NVIDIA Corporation with Inadequate Disclosures about Impact of Cryptomining

Cryptomining is the process of obtaining crypto rewards in exchange for verifying crypto transactions on distributed ledgers. As demand for and interest in crypto rose in 2017, NVIDIA customers increasingly used its gaming GPUs for cryptomining

During consecutive quarters in NVIDIA’s fiscal year 2018, the company failed to disclose that cryptomining was a significant element of its material revenue growth from the sale of its graphics processing units (GPUs) designed and marketed for gaming.

“NVIDIA’s disclosure failures deprived investors of critical information to evaluate the company’s business in a key market,” said Kristina Littman, Chief of the SEC Enforcement Division’s Crypto Assets and Cyber Unit. “All issuers, including those that pursue opportunities involving emerging technology, must ensure that their disclosures are timely, complete, and accurate.”

Without admitting or denying the SEC’s findings, NVIDIA agreed to a cease-and-desist order and to pay a $5.5 million penalty.

SEC Halts Fraudulent Cryptomining and Trading Scheme

The Securities and Exchange Commission today announced fraud charges against MCC International Corp. (MCC), which does business as Mining Capital Coin Corp., its founders Luiz Carlos Capuci, Jr. (aka Junior Caputti or Capuci) and Emerson Souza Pires (Pires), and two other entities controlled by Capuci, CPTLCoin Corp. (CPTLCoin) and Bitchain Exchanges (Bitchain).

According to the SEC’s complaint, Defendants MCC, Capuci, and Pires allegedly netted at least $8.1 million from the sale of the mining packages and $3.2 million in initiation fees

The SEC’s complaint seeks injunctions against future securities law violations, disgorgement of the defendants’ ill-gotten gains, civil penalties, and officer and director bars against Capuci and Pires.

SEC Nearly Doubles Size of Enforcement’s Crypto Assets and Cyber Unit

The SEC today announced the allocation of 20 additional positions to the unit responsible for protecting investors in crypto markets and from cyber-related threats. The newly renamed Crypto Assets and Cyber Unit (formerly known as the Cyber Unit) in the Division of Enforcement will grow to 50 dedicated positions.

Since its creation in 2017, the unit has brought more than 80 enforcement actions related to fraudulent and unregistered crypto asset offerings and platforms, resulting in monetary relief totaling more than $2 billion.