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The U.S. Securities and Exchange Commission (SEC) has accused Cumberland DRW LLC of operating as an unregistered dealer. The accusation comes as part of the SEC’s crackdown on the crypto industry.
The SEC said Cumberland acted as an unregistered dealer in trading $2 billion in crypto assets. The Chicago-based company describes itself as a “liquidity provider and risk-taking trading firm.” However, the SEC alleged that Cumberland’s profits from these activities were made without providing the necessary protections to investors and the market.
Jorge G. Tenreiro, interim head of the SEC’s Crypto Assets and Cyber Unit, said Cumberland and investors treated these crypto assets as securities and that Cumberland made significant unregistered profits by acting as a dealer in these assets. According to the complaint, Cumberland bought and sold at least $2 billion worth of cryptocurrencies starting in March 2018. It was also stated that Cumberland traded through an online trading platform called Marea, which he launched in 2019.
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The SEC defined cryptocurrencies such as POL, SOL, ATOM, ALGO and FIL as securities during this process. Cumberland allegedly failed to comply with federal securities laws and did not provide adequate protection to investors when trading these assets.
In response to this accusation, Cumberland stated in a statement on its X account that it had been negotiating with the SEC for five years and had shared the necessary documents. The company also stated that it would not make any changes to its operations and that it was confident in its ability to comply with the regulations.
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