- The Securities and Exchange Commission has now repealed registered securities of LBCC.
- Move aimed to protect investors and investor sentiments, says the SEC.
- The securities watchdog also finds glaring discrepancies in the filing of quarterly and annual reports by the firm.
Long Blockchain Corp, also known as LBCC, was formerly known as the Long Island Iced Tea Corp, a firm that dealt with the production, marketing and supply of cold drinks in the Long Island area. Ever since its name change, the company took a giant leap to deal with complex entities such as blockchain and cryptocurrencies at a time when investor risks were high, and the entities had no legal framework to rely upon.
Discrepancies in report filing
Since the end of the fiscal year 2017, LBCC has failed to file annual or quarterly reports about its blockchain-related activities. After several investigations by the SEC, it had come to light through the company had made the name switch, operations about blockchain and its corresponding counterparts had never become operational. Under the Securities Exchange Act of 1934, which gave the SEC certain rights and powers over a company’s securities, all the firm’s securities had been abrogated, which would take effect from 22nd February 2021. The firm’s common stock was listed on the NASDAQ exchange for one year from 2017 to 2018 until the NASDAQ exchange filed a counter-form 25 with the SEC in June of that year to remove all company listings’ securities. Acting upon the complaint received, the SEC then proceeded to take this step against LBCC. All common stock of the firm was listed on the alternative trading platform, OTC Link, a segment of the OTC Markets group, until 30th September 2018, when a non-filing of the 10-Q form led to its expiry.
Settlement offer
Seeing the walls closing in, the company expressed its interest to settle the case without letting it go to trial. The SEC too appears to agree to the yet undisclosed settlement terms. The giant leap from a cold-beverage company to a blockchain-based product company paid off at first. Its stocks saw a 400% increase; however, as blockchain operations were non-existent, the company suffered several setbacks. The first domino to fall was its delisting on the NASDAQ exchange, which led to its current state.