The Securities and Exchange Commission (SEC) has filed charges against beaxy.com and its executives for not registering as a national securities exchange, broker, and clearing agency.
The platform’s founder, Artak Hamazaspyan, and Beaxy Digital, Ltd., are accused of raising $8 million through an unregistered offering of the Beaxy token (BXY). Hamazaspyan is said to have taken at least $900,000 for his own use, such as gambling.
Hamazaspyan and Beaxy Digital are being sued by the SEC for securities fraud and for selling BXY without being registered.
The SEC has filed a complaint against Nicholas Murphy and Randolph Abbott, who managed Windy Inc., for offering and selling crypto assets as securities through their Beaxy Platform. The complaint alleges that Windy violated the Securities Exchange Act of 1934.
Even after Hamazaspyan resigned due to the unregistered offering of BXY and misappropriation of investor assets, Murphy and Abbott continued operating the platform and are liable for operating an unregistered exchange, broker, and clearing agency.
Windy also entered into agreements with Brian Peterson and his companies to provide market making services for BXY, which allegedly acted as unregistered dealers.
“We allege that Beaxy and its affiliates performed the functions of an exchange, broker, clearing agency, and dealer without registering with the Commission and complying with clear, time-tested rules governing those activities,” said SEC Chair Gary Gensler.
The defendants agreed to stop acting as an unregistered exchange, clearing agency, broker, and dealer. They also agreed to shut down the Beaxy Platform, give customers a full accounting of their assets and funds, give each customer their own assets and funds, and destroy all BXY in Windy’s possession.
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Civil fines of $79,200 were settled by agreement between Windy, Abbott, and Murphy. Windy has settled the disgorgement and interest owed to the court at a total of $10,779.
Peterson consented to a fine of $6,600. The Braverock Entities stipulated to pay a $80,000 fine in addition to $52,000 in restitution and interest.
