The Securities and Exchange Commission has filed a lawsuit against ICOBox, a California company in the business of facilitating other companies’ ICOs, and its founder Nikolay Evdokimov for conducting an illegal $14 million securities offering of ICOBox’s digital tokens and for acting as unregistered brokers for other digital asset offerings.

According to the SEC’s complaint, filed Sept. 18 in the U.S. District Court for the Central District of California, “[s]ince August 2017, ICOBox and Evdokimov have engaged in both the unregistered offering of securities through a $14.6 million ICOBox token sale, as well as the unregistered broker activities related to securities offered by ICOBox’s clients, exposing thousands of investors to risky investments without providing the necessary information and protections required by the federal securities laws.” ICOBox and Evdokimov claimed the tokens would increase in value upon trading and that ICOS token holders would be able to swap them at a discount for other tokens promoted on the ICOBox platform, the SEC said.

The complaint further alleges ICOBox failed to register as a broker but acted as one by facilitating initial coin offerings that raised more than $650 million for dozens of clients.

“By ignoring the registration requirements of the federal securities laws, ICOBox and Evdokimov exposed investors to investments, which are now virtually worthless, without providing information that is critical to making informed investment decisions,” said Michele Wein Layne, regional director of the Los Angeles Regional Office.

The SEC’s complaint charges ICOBox and Evdokimov with violating the registration requirements of the federal securities laws and seeks injunctive relief, disgorgement with prejudgment interest, and civil money penalties.