Japan's Securities and Exchange Surveillance Commission Seeks Injunction Against Three Unregistered Firms

According to CoinPost, the Japan Securities and Exchange Surveillance Commission filed an application with the Tokyo District Court on November 10, seeking prohibition and cease-and-desist orders against three unregistered companies engaged in financial instruments trading businesses (4CAPITAL MANAGEMENT GK, Shibata General Research Institute, and Ando General Research Institute) and their three representatives. According to the commission, the three companies sold 'Evolution' and 'S&P500 Index' products established by insurance entities under the U.S.-based ITA Group, raising approximately JPY 4.9 billion from at least 2,141 retail investors between February 2021 and February 2026;

Investigations by the Kanto Local Finance Bureau showed that the three companies had stated that 'Evolution' could be invested in ETFs targeting Bitcoin spot, and marketed 'S&P500 Index' as a 'principal-protected' product offering dividends equal to 160% of principal if held to maturity for 20 years; the commission noted that returns were not guaranteed. Ando General Research Institute also made unregistered sales of small-scale private placement bonds issued by Global Bridge Fund GK through a distribution network that included Shibata General Research Institute, raising approximately JPY 2.5 billion from at least 402 people, of which the portion handled by Shibata General Research Institute involved 132 people and approximately JPY 800 million.

The commission stated that this application does not prohibit refunds to customers, and warned that unregistered operators may use other customers' funds to make refunds.

Source: TechFlow