Telegram to Return $1.2 Billion to Investors and Pay $18.5 Million Penalty to Settle SEC Charges

The Securities and Exchange Commission announced today that it obtained court approval of settlements with Telegram Group Inc. and its wholly owned subsidiary TON Issuer Inc. to resolve charges that Telegram's unregistered offering of digital tokens called "Grams" violated the federal securities laws. The defendants agreed to return more than $1.2 billion to investors and to pay an $18.5 million civil penalty. On Oct. 11, 2019, the SEC filed a complaint against Telegram, alleging that the company had raised capital to finance its business by selling approximately 2.9 billion Grams to 171 initial purchasers worldwide. The SEC sought to preliminarily enjoin Telegram from delivering the Grams it sold, which the SEC alleged were securities that had been offered and sold in violation of the registration requirements of the federal securities laws.