FRAUDSTER CLAIMS ICO WAS 'SEC REGULATED' WHEN IT WASN'T!

SEC v. Sergii Grybniak, Opporty International, Inc. — U.S. Securities and Exchange Commission Litigation Release No. 26257, dated February 26, 2025.

The SEC charged Sergii Grybniak and his company, Opporty International, Inc., for conducting an unregistered and fraudulent initial coin offering (ICO) of OPP Tokens. They raised approximately $600,000 from nearly 200 investors by making false claims about the platform's user growth, partnerships, and regulatory compliance. The court granted partial summary judgment and entered a final judgment against the defendants.

In Plain English

Imagine someone selling special digital coins to raise money for a new online marketplace. They told people the marketplace was already very popular with lots of businesses and had a big company as a partner, and that the coin sale was approved by the government. In reality, the marketplace was mostly empty, the partnership was fake, and the government approval claim was false. The court agreed this was misleading and illegal.

Disclaimer: all facts are drawn from the SEC's own filings; the claims described are allegations unless and until a court rules or the parties settle, and some cases end in dismissal.

How the Alleged Scheme Worked

1. Launch of OPP Tokens From September 2017 to October 2018, Sergii Grybniak and Opporty International, Inc. conducted an initial coin offering (ICO) to raise funds for their blockchain-based marketplace. They offered digital assets called OPP Tokens to investors.
2. Unregistered Offering The defendants did not file a registration statement with the SEC for the OPP Tokens offering. This meant potential investors did not receive the detailed financial and risk information typically required for securities offerings.
3. Exaggerated User Growth Claims On Opporty's website and social media, Grybniak and Opporty falsely claimed to have 'onboarded' thousands of 'verified providers' willing to use the platform. In reality, most of these purported providers had no such intention.
4. Misleading Business Catalog Defendants also claimed their platform had over 17 million small U.S. businesses in its catalog. This was misleading because they had merely purchased a database, which included non-eligible entities like government officials, not actual businesses ready to use the platform.
5. Fabricated Reviews and Content They deceptively used hundreds of reviews and ratings from other websites and content from purported 'verified providers' on Opporty's site. This created a false impression that the content was generated on Opporty's platform by actual users.
6. False Partnership Claims Defendants falsely represented that a major software company was a 'partner' or 'participant' in Opporty's ICO and business, misleading investors about the legitimacy and backing of the venture.
7. False Regulatory Claims Crucially, Grybniak and Opporty marketed the ICO as 'SEC regulated' and '100% SEC compliant,' despite not having filed any registration statement or exemption with the SEC.
8. Raising Funds Fraudulently Through these material misrepresentations and omissions, Grybniak and Opporty raised approximately $600,000 from nearly 200 investors for their OPP Token ICO.
9. SEC Files Complaint The SEC filed its complaint on January 21, 2020, alleging unregistered and fraudulent securities offering, along with deceptive conduct during the ICO.
10. Partial Summary Judgment On September 24, 2024, the Court granted the SEC's motion for partial summary judgment, finding that Grybniak and Opporty conducted an unregistered securities offering in violation of the Securities Act.
11. Final Judgment Entered On February 4, 2025, the Court entered a final judgment against Grybniak and Opporty, providing for permanent injunctive relief and ordering Grybniak to pay a $100,000 civil penalty.

The Enforcement Action

SEC Litigation Release No. 26257 / February 26, 2025: SEC Granted Partial Summary Judgment and Obtained Final Judgment Against Founder of Blockchain Marketplace Company for Unregistered and Misleading ICO. On February 4, 2025, the U.S. District Court for the Eastern District of New York entered a final judgment against Sergii Grybniak and Opporty International, Inc. The SEC's complaint was filed on January 21, 2020. The SEC alleged that from September 2017 to October 2018, Grybniak and Opporty conducted an unregistered and fraudulent securities offering of crypto assets called OPP Tokens via an initial coin offering, raising approximately $600,000 from nearly 200 investors. The complaint also alleged Grybniak and Opporty marketed the ICO by making material misrepresentations and omissions, including exaggerating user growth, misrepresenting a partnership, and falsely claiming the ICO was 'SEC regulated' and '100% SEC compliant.' On September 24, 2024, the Court granted the Commission’s motion for partial summary judgment, finding Grybniak and Opporty had conducted an unregistered securities offering. The final judgment provides for permanent injunctive relief under Sections 5, 17(a)(2), and 17(a)(3) of the Securities Act. The final judgment also ordered Grybniak to pay a civil money penalty of $100,000 and imposed a conduct-based injunction against him.

Named in this action: Sergii Grybniak, Opporty International, Inc..

Original SEC litigation release ↗ · Browse all cases