The Texas State Securities Board filed an emergency ceasefire order against cryptocurrency lending firm Abra on June 15.
In its order, the regulator said that based on its investigations, it had determined that Abra and related parties committed fraud and made misleading statements.
The regulator said Abra made misleading statements by suggesting it was a “cryptobank” when in fact Abra and its companies do not have a Texas banking charter, are not licensed to operate in Texas and do not provide FDIC deposit insurance.
The Securities Board additionally said that Abra and related parties had “secretly” transferred interests to Binance.com and had more than $118 million on the platform as of February 2023. It said Abra filed the US Securities and Exchange Commission and Commodity and Futures Trading Commission’s ongoing lawsuits against Binance and related parties, misleading customers.
The regulator described numerous other instances where Abra made fraudulent and misleading statements today.
It also said that during its March 31, 2023 investigation, it determined that Abra’s various parties were “collectively insolvent or near insolvent”.
Abra ordered to stop and stop
The filing orders the various companies and CEO of Abra to stop making fraudulent offers in Texas and making misleading statements. It also aims to get Abra and related parties to pay a fine and refund money to customers.
The regulator does not specifically indicate how Abra should make changes to its services. Abra Earn was discontinued during the TSSB’s October 2022 investigations; Abra Boost will continue to be available to accredited and institutional investors in the US
The filing names Plutus Financial – which does business as Abra – as well as Abra Boost LLC and Abra CEO Bill Barhydt as the target of the order.
Abra and Barhydt have not publicly responded to the filing. The company did not respond to CryptoSlate’s request for comment as of this writing.
Texas post-regulator says Abra secretly moved funds to Binance, has been insolvent for months and first appeared on CryptoSlate.