SEC Amends $22M Penalty Against LBRY, Seeks $111K Instead

The United States securities regulator is seeking to modify its $22 million sentence against decentralized content platform LBRY, acknowledging that it is unlikely to be able to spend the money to be able to pay.

in may 12 Admission In New Hampshire District Court, the Securities and Exchange Commission (SEC) sought to amend its request for remedies in its successful case against LBRY.

Instead of seeking the original $22 million – the amount that LBRY claims it received from the sale of its token LBRY Credits (LBC), the SEC cited LBRY’s “lack of funds and near-dormant status” The court has been asked to impose a fine of $111,614. ,

The request also asks LBRE to stop “conducting future unregistered offerings of crypto asset securities”.

“The Commission accepts LBRY’s representations that it is inactive, ceasing operations, and without funds to pay large fines, and recognizes that a defendant’s ability to pay is a factor,” the SEC said in the filing. “

Millions of dollars were spent in fines of $111,614.00 and a company was financially ruined. That’s what helps the world. https://t.co/GhvCS0Az7s

— Bill Morgan (@Belisarius2020) 12 May 2023

The SEC first filed a civil lawsuit against LBRY in March 2021, alleging that the firm’s LBC sales were unregistered securities offerings. It asked for a $22 million withdrawal and for the court to order LBRY to stop the LBC sale.

The SEC won the case in November 2022, with the preceding judge also ruling that LBC is a security.

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The SEC said the small fine was a compromise between “the need to balance deterrence from the penalty with LBRY’s inability to pay”.

In the December filing, LBRY Claimed The SEC’s request for $22 million was not reasonable because it was “grossly” exaggerated and failed to “reduce any legitimate business expenses of LBRY”.

LBRY said the SEC’s calculation of the amount was “based on rough, back-of-the-envelope math” and that the amount sought was “not supported by the record.”

In December 2022, about a month after the SEC won the case a month earlier, LBRY said it would be “dead in the near future” due to being “killed by legal and SEC debts”.

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