Name: Feds Again Target N.H. Cryptocurrency Firm With Libertarian Ties
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Feds Again Target N.H. Cryptocurrency Firm With Libertarian Ties

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© 2022 New Hampshire Public Radio.Play Live Radio0:000:00Available On Air StationsFor the second time in a month, federal regulators are cracking down on a New Hampshire-based company involved with cryptocurrency that also has ties to the libertarian movement.&nbsp;On Monday, the Securities and Exchange Commission filed a in federal court alleging that Manchester-based LBRY, Inc. violated securities laws when it failed to register millions of dollars in digital currency offerings.The suit comes after were filed against Ian Freeman and five other New Hampshire residents who are accused of money laundering and other financial crimes related to a cryptocurrency exchange platform.In that matter, Freeman, a minister and well-known libertarian activist in the Keene region, was this week after a judge deemed him a flight risk and potential danger to the public.LBRY’s CEO, Jeremy Kauffman, is a computer scientist and board member of the , which encourages “freedom-loving people” to move to New Hampshire in an effort to bring a libertarian influence to local and state politics.&nbsp;The two legal matters appear to be unrelated, and are both the result of lengthy investigations. The SEC didn’t return a request for comment.LBRY is the government’s classification of its digital currency as a security, and in a statement said the claim is a “tremendous threat to the entire cryptocurrency industry.”The government’s civil complaint alleges LBRY failed to register the offering and sale of its own digital token called LBC, also known as . The SEC is seeking a permanent injunction against the company from further securities sales, and is asking a court to order LBRY to “disgorge its ill-gotten gains.”&nbsp;In a response posted on a company-owned website, LBRY said the SEC’s investigation began in 2018. The company said it attempted to settle the matter, but the government rejected those offers. LBRY said it has already spent more than a $1 million on legal fees related to the investigation.“We were willing to give them a pound of flesh, but they were only interested in our head,” the company said in a statement.LBRY operates , a blockchain-based video hosting platform that seeks to rival YouTube, albeit with less restrictions. Video producers can earn money in the form of credits through pageviews and tips from viewers.Freeman, who moved to New Hampshire in 2006 after by the , was arrested by the FBI on March 16 on charges that he operated an unlawful cryptocurrency exchange platform that deceived banks by claiming it was accepting donations on behalf of religious organizations that he founded, including the Crypto Church of New Hampshire.Prosecutors allege that Freeman and co-defendants falsely claimed their accounts were used to receive church donations and do church outreach when they actually were used to handle money for an illegal virtual currency exchange business. Prosecutors say Freeman’s operation was favored by scam artists who believed they could use his service anonymously -- including so-called romance scammers, who use social media or online dating profiles for purposes of blackmail.In an order released Monday, federal Magistrate Judge Andrea Johnstone found that Freeman would pose a flight risk and danger to the community, if released pending trial.“Mr. Freeman allegedly built and oversaw a wide-ranging criminal enterprise that misled financial institutions, enabled fraud, and allowed those engaged in criminal activity to exchange their ill-gotten gains for virtual currency,” said Johnstone. “Mr. Freeman was aware of the investigation into his activities; however, he was undeterred by law enforcement’s inquiries and, based on the timeline in the record, continued to engage in such activities and encourage others to do so.”LBRY hasn’t yet responded to its civil complaint in court. It argues that at no time did the company indicate that its digital currencies “were an investment, and consistently discouraged purchasing credits for this purpose.”Todd started as a news correspondent with NHPR in 2009. He spent nearly a decade in the non-profit world, working with international development agencies and anti-poverty groups. He holds a master’s degree in public administration from Columbia University.Latest StoriesNHPR is nonprofit and independent. We rely on readers like you to support the local, national, and international coverage on this website. Your support makes this news available to everyone.Give today. A monthly donation of $5 makes a real difference.

© 2022 New Hampshire Public Radio.Play Live Radio0:000:00Available On Air StationsFor the second time in a month, federal regulators are cracking down on a New Hampshire-based company involved with cryptocurrency that also has ties to the libertarian movement.&nbsp;On Monday, the Securities and Exchange Commission filed a in federal court alleging that Manchester-based LBRY, Inc. violated securities laws when it failed to register millions of dollars in digital currency offerings.The suit comes after were filed against Ian Freeman and five other New Hampshire residents who are accused of...

Feds Again Target N.H. Cryptocurrency Firm With Libertarian Ties

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