On December 11 the California-based Munchee Inc. received a cease-and-desist from the U.S. Securities and Exchange Commission (SEC) ordering the company to halt their ICO and return the already collected funds.
The goal of Munchee’s ICO was to raise 15 million USD to be used to improve their mobile application as well as fund a system of restaurant reviews. Munchee then stated that it would create a secondary market for the tokens as an investment vehicle, giving the investors an impression that their tokens would appreciate, all this before the utility of the token being made available.
The commission did not impose a penalty on Munchee because the latter stopped the ICO and returned all the funds to the investors.
Stephanie Avakian, co-director of the SEC Enforcement Division said that the agency will continue to scrutinize the market for improper offerings “that seek to sell securities to the general public without the required registration or exemption.”