New York Attorney General Shuts Down Coin Seed Crypto Trading Platform That Defrauded Investors Out of Millions – Regulation

New York Attorney General Letitia James has obtained a court order to shut down cryptocurrency exchange Coinseed. The resolution also permanently appoints the judicial insolvency administrator to receive, secure and return all assets invested and traded on the stock exchange.

New York Attorney General Letitia James shuts down crypto exchange

New York Attorney General Letitia James' office announced Monday that the attorney general's office has shut down cryptocurrency trading platform Coinseed.

James has obtained a judgment against Coinseed and its founder and CEO Delgerdalai Davaasambuu, “permanently halting their illegal and fraudulent operations,” the announcement said, adding:

The judgment entered today by Attorney General James permanently appoints the court administrator to preserve, secure and return all assets invested and traded through Coinseed and orders a monetary judgment against the defendants in the amount of $3,061,511 both jointly and separately.

Attorney General James filed suit against Coinseed in February for defrauding thousands of investors in the US Coinseed CEO Delgerdalai Davaasambuu and CFO Sukhbat Lkhagvadorj were also charged accused in a suit.

The Attorney General's Office further revealed that it has received more than 175 complaints from investors about the exchange since the lawsuit was filed.

Despite the legal action, Coinseed and its CEO “continued their fraud and engaged in additional fraudulent behavior by trading in investor accounts without permission and then blocking investors’ access to those accounts,” the announcement said.

In June, the New York State Supreme Court granted James' request for a preliminary injunction. However, Coinseed and its CEO “defied this injunction by” create, offer and sell a new virtual currency - including for New York investors - and did not respond to Attorney General James' complaint.

Attorney General James said:

Coinseed and its CEO have engaged in egregious and fraudulent activities for years that have defrauded investors of millions. Despite court orders, this company continued to act illegally and unethically, holding investors' funds hostage and highlighting the dangers of investing in unregistered virtual currencies.

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