WASHINGTON, D.C. — AriseBank's former CEO and COO will pay a $2.7 million settlement to resolve charges by the U.S. Securities and Exchange Commission (SEC) of engaging in a initial coin offering (ICO) scam, according to the federal agency.
The SEC alleges Jared Rice Sr., AriseBank's former CEO and Stanley Ford, AriseBank's former COO, sold and marketed "unregistered investments" with their "AriseCoin" cryptocurrency.
“Rice and Ford lied to AriseBank’s investors by pitching the company as a first-of-its kind decentralized bank offering its own cryptocurrency for customer products and services,” said SEC Fort Worth Regional Office director Shamoil T. Shipchandler in a statement. “The officer-and-director bar and digital securities offering bar will prevent Rice and Ford from engaging in another cryptoasset-based fraud.”
According to the SEC, Rice and Ford will be responsible for $2,259,543 in disgorgement and an additional $68,423 in prejudgement interest. Rice and Ford will also each pay a $184,767 penalty and will be permanently barred from serving as officers and directors of public companies or being involved in digital securities, the SEC said. The two are also prohibited from any future violations of federal securities laws.