30. November 2020
Breaking News

The SEC asks a court to order Telegram to pay $1.2 billion back to its investors

The U.S. Securities and Exchange Commission, or SEC, has filed a proposed final court ruling regarding the cancelled Telegram Open Network project.

In the proposed final judgment, filed on June 25, the SEC asked the United States District Court for the Southern District of New York to order $1 million in fines for multiple defendants in connection with the case.

„The defendants are jointly and severally liable for the return of $1.2 billion,“ the SEC wrote in the proposed ruling. As of this writing, the court has received the sentence. Although the court has „reviewed and approved the form of the proposed judgment,“ it is not yet final.

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Telegram agreed to return the $1.2 billion to investors and SEC fines
Of the total $1.2 billion for the refund, $1.19 billion represents the amount that the defendants have paid as termination amounts, or the original contracts to be paid to the investors. Meanwhile, Telegram Group is liable for a civil penalty Bitcoin Method of $18.5 million, payment of which must be made within 30 days after entry of the proposed judgment, the SEC wrote.

According to the document, Telegram has agreed to pay the $18.5 million fine following a settlement reached on June 11.

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The amount of the fine will go to the United States government „for any purpose“
According to the ruling, the SEC must send funds paid pursuant to the ruling to the U.S. Department of the Treasury. The amount requested to be paid must be treated as „fines paid to the government for any purpose,“ including all tax purposes, the SEC wrote.

In the judgment, the SEC specified that the defendants can make the payment electronically through the Automated Clearing House network or Fedwire Funds Service. The regulator said the payment also can be made directly from a bank account through Pay.gov via the SEC’s website, as well as certified checks, cashier’s checks or U.S. postal money.

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Telegram will have 30 days to pay if the sentence is accepted by the court
In the event that the defendants do not send the amount within 30 days of the entry of the judgment, the SEC may enforce the Court’s judgment by rescission and civil penalty, through a civil contempt motion.

The SEC went on to explain that the defendants waive all rights to the funds:

„By paying the Termination Amounts (as that term is defined in Section 1.1 of the „Grams Purchase Agreements“), or the restitution and civil penalty amounts to the Commission, Defendants are giving up all legal and equitable rights, title and interest in such funds and no part of the funds will be returned to Defendants.