In an updated complaint against Ripple, the SEC said Brad Garlinghouse and Chris Larsen played a “significant role” in organizing unreported sales and manipulating the price of XRP.
The US Securities and Exchange Commission (SEC) has filed an amended complaint against Ripple, its CEO Brad Garlinghouse and former CEO Chris Larsen. The new version of the lawsuit adds factual information about individual defendants – Garlinghouse and Larsen, who are accused of playing a “significant role” in organizing unreported XRP sales. The SEC describes several cases where sales adjustments were used by Ripple executives to control the price of a cryptoasset.
“In April 2016, the CFO emailed Larsen and Garlinghouse about the ongoing ‘downward pressure on XRP price’ and suggested that the market maker ‘slightly lower our net sales target by a few days to see if we can help stabilize and / or increase the XRP price “, – says the SEC lawsuit.
To the CFO’s proposal, Larsen replied, “Yes, let’s try,” and Garlinghouse said he was “in favor” of the adjustment, but “somewhat prone to more aggressive actions.” The complaint also highlighted Garlinghouse’s efforts to make XRP available to crypto exchanges in the US and overseas, which include a “incentive program” with “minimum monthly guarantees.”
“In December 2016, Garlinghouse again attempted to list XRP on platform A. In an email dated December 1, 2016, he stated that Ripple’s 2017“ incentive program ”for exchanges, along with efforts to increase the institutional adoption of XRP for settlement,“ will expand opportunities for traders [платформы A]”And that Ripple” would be happy to offer minimum monthly guarantees in 2017 to be listed, “the SEC said.
In an email to the undisclosed cryptocurrency platform, Garlinghouse stated that exchanges refusing to place XRP over concerns that the crypto asset could be classified as a security could “harm” Ripple. Larsen was also active in listing XRP on exchanges, even when he was no longer CEO of the company. According to the SEC complaint, when one of the derivatives exchanges refused to list the crypto asset due to legal uncertainty, he expressed his disappointment to Garlinghouse:
“Larsen forwarded this reply to the exchange, noting,” These guys are an annoying problem. ” Garlinghouse responded to the letter and asked Ripple Agent-1 to keep him and Larsen “up to date” on this topic, “the lawsuit says.
The updated lawsuit also mentions that some of Garlinghouse and Larsen’s personal XRP sales took place in the United States:
“Garlinghouse’s XRP sales have taken place on a variety of digital asset trading platforms, including platforms A and B, as well as at least two others registered in the US and one registered overseas, but with a primary location in New York.”
Garlinghouse sold over $ 159 million worth of XRP between April 2017 and October 2019. Meanwhile, Larsen and his wife made over $ 450 million in cryptoasset sales from 2015 to March 2020.
Recall that in December, the SEC filed a lawsuit against Ripple, accusing it of selling unregistered securities in the amount of $ 1.3 billion. Recently it became known that the company and the regulator will not be able to settle the proceedings out of court due to changes in the SEC leadership.
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