When Lawyers and Frauds Collide: The Great Linqto Fiasco

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Imagine a world where retail investors, armed with nothing but hope and a few spare dollars, are led into the lion’s den by a man named Sarris. Representing thousands of these brave souls, the case accuses Sarris of selling shares in private firms like Ripple, Uphold, and Kraken through unregistered special purpose vehicles (SPVs), all while hiding hefty markups and sidestepping key financial regulations. 🤑

According to the lawsuit, Sarris ignored internal legal warnings throughout 2023 and 2024, continuing to promote investment structures that allegedly violated SEC and FINRA rules. The legal complaint also claims Linqto charged up to 60% in hidden fees and used deceptive language to exploit regulatory exemptions. It’s like a magician’s trick, but with your hard-earned cash! 🎩✨

Ripple CEO Brad Garlinghouse has publicly distanced Ripple from Linqto, especially amid growing scrutiny from federal regulators. It’s a bit like saying, “I didn’t see the elephant in the room, honest!” 🐘

Meanwhile, Linqto is now under bankruptcy protection in Houston. The new management accuses former executives of misleading customers about their actual ownership in over 100 private firms, allegedly inflating the value of customer holdings beyond $500 million. John Deaton, who is also pushing for investor prioritization in the bankruptcy process, insists that any financial recovery—whether through insurance or legal settlement—should go first to the customers who lost savings on the platform. It’s a bit like saying, “The last one to leave, please turn off the lights.” 🌟

Regulators are now circling, with both the SEC and FINRA probing Linqto’s business model. Fresh revelations from the company’s current leadership suggest serious discrepancies around customer asset ownership. It’s like a game of “Who’s Got the Most Hidden Fees?” but with real consequences. 🎲

Adding to the complexity, a group of shareholders led by Australia’s Sapien Group has challenged the proposed bankruptcy reorganization, claiming the current plan fails to serve investor interests. With over half of Linqto shareholders supporting the objection, a legal fight over the future of the company appears imminent. It’s a bit like a game of chess, but with more lawyers and fewer pawns. 🏛️

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2025-07-10 14:52