Nui gambling investor funds over unregistered securities outside Texas
Following Nui’s fine for securities fraud violations in Texas it should be clear that, in order to operate legally in the US, Nui needs to register its securities offering.
Instead of doing that though, the company is pushing ahead – on the gamble that other states and the SEC will not take any further action against it.
Securities law in Texas is immaterially different to other US states, or indeed the Securities and Exchange Act at a federal level.
That means that if one state determines a company is offering unregistered securities, there’s a 99.99% chance any other US state, or the SEC at a federal level, will too.
Rather than acknowledge this and take the necessary steps towards operating legally in the US, Nui is pressing ahead as if nothing happened in Texas.
After Nui published a link to its “Nui successfully resolves Texas State Securities Board Investigation into crypto mining” press-release on Facebook, one of their investors asked;
But this constitutes a precedent that any other state can use or isn’t it the case?
To which Nui gave a misleadingly elusive answer;
While there’s no telling what each state will do, Nui strives to abide by all relevant laws and regulations and will continue to do so.
What a load of baloney.
As I’ve already stated, in order to operate legally in the US, Nui would have to register with the SEC. Or at the very least in every state the company operates in (all of them except Texas).
This, among other things, would see Nui put in writing that they are doing what they say they are doing, and leave them legally liable if they weren’t.
Compliance with securities law in the US is not optional, any more so than it wasn’t in Texas.
Nui’s Texas securities fraud fine isn’t some new law the company had no idea of, it’s the upholding of securities law at a state level that has been around since 1957.
Every single US state has similar securities laws, with the Securities and Exchange Act giving the SEC federal jurisdiction in any state.
The take away for Nui’s current and potential investors is that if Nui is illegal in Texas, it’s illegal all over the US.
Whereas the Texas Securities Board has gotten Nui to provide refunds to its Texas investors, the rest of the company’s investor-base won’t be so lucky.
We don’t have any official figures but it’s a given Darren Olayan and the rest of Nui management aren’t working for free.
It is impossible for Nui to refund all investors (where do you think the money Nui is refunding Texas investors is coming from?). Meaning that should other states and/or the SEC move to enforce securities law and take further action, there’s going to be losses.