Intro: The three owners of the Long Blockchain Company have been charged with changing its company’s name from Long Island Iced TeaCompany to Long Blockchain Company. The SEC has filed the charges against the trio.
The U.S. regulatory body has filed charges against Eric Watson, Oliver Ballet-Lindsay and Gannon Giguiere are accused of insider trading related to the Long Blockchain Company. The three people were accused of changing the company’s name from the Long Island Iced Tea Company.
As per the announcement of the Securities and Exchange Commission of the United States, the trio was facing charges in the U.S. District Court for the Southern District of New York. They were charged for their role in trades connected to rebranding a beverage business to a blockchain firm.
It has caused the company’s stock price to rise significantly. Giguiere bought 35,000 shares of Long Blockchain, after having been allegedly tipped off to change by Barret-Lindsay. Lindsay had earlier been alerted by Watson.
The name of the firm was changed in 2018. When the company decided to focus on blockchain development, the stock price surged by 289%- more than 380% intraday as per SEC. Giguiere has sold off his shares for more than $160,000.
Long Island Iced Tea Company was formed in 2011. It is a non-alcoholic beverage company formed in the U.S. but the company later shifted its operations to blockchain and later focused on crypto mining. The company’s shares were delisted by the SEC officers in February after it alleged that the firm hadn’t produced any financial reports.
The Nasdaq Story
The company in September 2020 had announced the sale of its beverage subsidiary to Canadian firm ECC2 Ventures. The rebranding of the company was done and it was named Long Blockchain company, which got delisted from the Nasdaq for low market capitalisation. In a few months, it was issued a subpoena by the United States Securities and Exchange Commission. In 2017, it was a trend that the companies used to capitalize on the blockchain euphoria sweeping the globe and add the word blockchain to their names.
The FBI is also looking into the rebranding of the firm case and evidence of insider trading and securities fraud. The FBI was seeking to expand a warrant from another case to gain access to communications for their investigation into the former Iced Tea Company. These communications allegedly include evidence that the firm was involved in a possible trading scam.