SEC v. Reginald Middleton and Veritaseum (price manipulation, 2019)

Judgment entered

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In 2019, the Securities and Exchange Commission obtained a judgment against Reginald Middleton and Veritaseum, alleging conduct this library classifies as price manipulation in the VERI initial coin offering. The judgment records disgorgement of $7.9 million, prejudgment interest of $582,535, and a $1 million civil penalty against Middleton.

The record

What was ordered

Civil penalty

$1m

Disgorgement

$7.9m

Prejudgment interest

$583k

Total relief

$9.5m

Alleged gain

—

A dash means the release did not state a figure we could extract, not that the figure is zero. Penalty and disgorgement are stored separately so aggregates across the library do not double-count the same dollars.

What is alleged to have happened

the Securities and Exchange Commission filed this matter on August 12, 2019 in the U.S. District Court, Eastern District of New York (No. 19-cv-4625); the release announcing the final judgment is dated November 14, 2019 (release LR-24665). The respondents named are Reginald Middleton and the entities he owned, Veritaseum, Inc. and Veritaseum, LLC.

The complaint alleges that Veritaseum and Middleton fraudulently raised millions of dollars in virtual currency from unregistered sales of securities called "VERI" based on false and misleading statements about the venture's profitability, viability, and the use and amount of funds raised in the ICO. Separately, the SEC alleged that Middleton manipulated the price and volume of VERI on secondary digital-asset trading platforms during the ICO.

This library tags the matter as price manipulation, based on the secondary-market trading conduct the regulator describes. The tagging is ours, not the regulator's: the final judgment enjoins Middleton specifically from further violations of the market-manipulation provision of Exchange Act Section 9(a), in addition to the registration and antifraud provisions charged against all defendants.

The conduct is recorded against crypto.

The relief recorded in our data is a civil penalty of $1,000,000, disgorgement of $7,891,600, prejudgment interest of $582,535. Penalty and disgorgement are distinct: disgorgement returns the gain, while the penalty is punitive. We store them separately so that aggregate figures across the library are not double-counted.

On November 1, 2019, the court entered a final judgment on consent, without the defendants admitting or denying the allegations, enjoining future violations and permanently barring Middleton from serving as an officer or director of a publicly traded entity. The defendants were ordered, jointly and severally, to disgorge $7,891,600 in ill-gotten gains plus $582,535 in prejudgment interest, and Middleton was separately ordered to pay a $1,000,000 civil penalty. The judgment established a Fair Fund under Sarbanes-Oxley Section 308(a) to distribute the collected assets to victims.

For the regulator's own account of the facts, read the primary document linked above. This page deliberately summarises the structured record rather than reproducing the release.

What technique is this, and how does it work?

This action is tagged with one technique in our taxonomy. The tagging is ours: regulators charge statutory provisions, not technique names, so the mapping is an editorial judgement described in our editorial policy.

• Price manipulation — see how it works, what statute it engages, and every other action tagged the same way.

Timeline

1. 2019-08-12 Complaint filed (E.D.N.Y., No. 19-cv-4625)
2. 2019-11-01 Final judgment entered on consent

Primary documents

Everything on this page derives from the documents below. Where our summary and the primary document disagree, the primary document is right.

• SEC litigation release

The linked release is a work of the United States government and is not subject to copyright. Our summary and narrative above are our own writing.

Related actions

Other actions in the library sharing at least one technique tag with this one.

Record added October 1, 2026. submit a correction.