What has happened?
The Securities and Exchange Commission (SEC) has temporarily suspended trading in the securities of UBI Blockchain (UBIA).
What does this mean?
The US regulator has issued a statement, explaining that the freeze is effective from 9.30am EST on 8 January until 11.59pm EST on 22 January 2018.
The SEC said the suspension was due to concerns over UBIA's filings and recent usual market activity.
“The Commission temporarily suspended trading in the securities of UBIA because of (i) questions of the accuracy of assertions, since at least September 2017, in filings with the Commission regarding the company’s business operations; and (ii) concerns about recent, unusual and unexplained market activity in the company’s Class A common stock since at least November 2017.”
“The SEC's scrutiny isn’t going away any time soon,” said Gregory Lisa, a partner in the Washington D.C. and New York offices of Hogan Lovells US, who formerly led the Office of Compliance and Enforcement at FinCEN within the US Department of Treasury.
“The swiftness and publicity surrounding these orders aren’t by accident; the SEC is making it clear to other market participants that it takes securities rules seriously, and it expects the industry to be aware of them.”
The SEC also issued a general warning to broker-dealers, shareholders, and all prospective purchasers to consider "any information subsequently issued by the company", in light of the current statement.
The statement further stipulates that broker and dealers should refrain from entering into quotations for UBIA common stock unless they comply with Rule 15c2-11 of the Securities Exchange Act.
Brokers or dealers unsure as to whether they have complied with the rule should contact the Division of Trading and Markets, Office of Interpretation and Guidance.
The commission said it will consider taking enforcement action against those in violation and asked that brokers and dealers familiarise themselves with the rule.
UBIA is a Delaware corporation based in Hong Kong and is quoted on OTC.
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