SEC Chief of Cryptocurrency and Cyber Unit Stepping Down

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The US Securities and Exchange Commission (SEC) has announced that Robert A. Cohen, Chief of the Division of Enforcement’s Cyber Unit, will be stepping down from the position.

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Cohen has been the Chief of the Cyber Unit since it was created in 2017. During his appointment, he led several investigations into Initial Coin Offerings (ICOs) by unregistered companies and was instrumental in bringing their founders to justice.

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Cohen Has Been a ‘True Leader’ in the Agency

Cohen will be leaving the agency in August after roughly 15 years of service. The cyber unit deals with violations in the digital asset space, as well as cryptocurrency and cyber trade-related violations. During his time at the cyber unit, Cohen has been involved in numerous high profile investigations, including fraudulent Initial Coin Offerings (ICO), undisclosed endorsements or promotions of ICOs by celebrities, and unregistered securities exchanges dealing with cryptocurrency-based tokens.

On Cohen’s departure from the agency, Chairman of the SEC, Jay Clayton said,

“I’m grateful to Rob for his thoughtfulness, expertise, and leadership in taking on the creation of the Cyber Unit.”

Stephanie Avakian, Co-Director of the SEC’s Division of Enforcement, said that he was a “true leader” in the division and that they relied on him to navigate complex and high priority cases. Cohen also mentored several SEC attorneys and supervisors.

Former Chief Led Groundbreaking Investigations

One of Cohen’s most notable cases was the SEC’s investigation into Centra Tech. Inc. The company was charged with conducting a fraudulent ICO and raising $32 million worth of digital currency. Central Tech promised investors unregistered ‘CTR’ tokens in exchange for their money. Both co-founders were arrested.

The SEC also charged professional boxer Floyd Mayweather Jr. and music producer DJ Khalid for not disclosing payments they received from Centra Tech to promote its ICO. Mayweather and Khalid were penalized $614,775 and $152,725 respectively in disgorgement, penalties, and interest.

In a similar case last year, CarrierEQ Inc. (Airfox) and Paragon Coin Inc. were charged with selling unregistered securities. The two companies raised $15 million and $12 million but were forced to compensate investors and pay penalties worth $250,000.

In yet another case, the SEC charged Kik, an online messaging app for hosting an unregistered ICO in 2017. Kik raised $100 million in funds for its Kin digital currency, receiving $55 million from U.S. investors alone. Kik sold one trillion tokens to 10,000 investors worldwide. The company was charged with not registering under the Federal Securities Act.

Do you think the SEC has successfully policed the heavily unregulated ICO space? Let us know your thoughts in the comments below.

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Rahul Nambiampurath is an India-based Digital Marketer who got attracted to Bitcoin and the blockchain in 2014. Ever since, he's been an active member of the community. He has a Masters degree in Finance.

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