The U.S. Securities and Exchange Commission (SEC) has filed a lawsuit against Green United, saying that the Utah-based business sold fake cryptocurrency mining equipment worth $18 million in violation of federal securities laws.
The SEC filed a complaint alleging that Green United and two others, including the company’s creator Wright Thurston, 46, and Kristoffer Krohn, 43, solicited investments in $3,000 “Green Boxes,” specialised crypto mining devices that claimed to generate GREEN tokens on the Green Blockchain.
Investors were allegedly informed that the GREEN tokens mined supported a “public worldwide decentralised power infrastructure” while producing a handsome 40% to 50% monthly return.
Investors were allegedly informed that Green United’s ability to keep control over their “Green Boxes,” which would be remotely hosted at a Green United-controlled data centre, was essential to the success of their investments. Investors would receive GREEN tokens produced by their equipment.
However, the SEC claims that Green United’s mining equipment never mined GREEN because it was not a crypto asset that could be mined and there was no such thing as a “Green Blockchain” at the time. Instead, it is claimed that Thurston himself produced the GREEN tokens on the Ethereum blockchain and distributed them to clients’ wallets “many months” after he and Krohn began marketing the machines to investors in April 2018.
Additionally, the SEC asserts that the value of GREEN tokens never grew, in contrast to what Krohn purported to have told Green United’s investors. They weren’t marketable on a secondary market until the fall of 2020, and the current price of $.004 is much lower than the promised starting value of 2 cents per token.
The SEC claims that Green United’s underlying plan was to con investors into purchasing S9 Antminers, which is bitcoin mining equipment, disguised as “Green Boxes.” The purchases made by the investors were useful and “mined [bitcoin], which the investors did not receive.”
Along with disgorgement and civil penalties, the SEC is requesting permanent injunctions against Green United, Thurston, and Krohn. Krohn has had previous dealings with the SEC before the lawsuit. Due to false statements the promoter made in connection with a real estate investment scheme, the SEC was able to win injunctive action against him in 2012.