The U.S. Securities and Change Fee sued Justin Solar, the founding father of Tron, for allegedly orchestrating “unregistered providing and promoting, manipulative buying and selling, and illegal promoting of securities of crypto property,” the company mentioned on Wednesday.

The SEC mentioned it was suing Solar, its Tron Basis, the BitTorrent Basis, and BitTorrent (now referred to as Rainberry) over the sale of two tokens: TRON, or TRX, and bitTorrent, or BTT. Each TRX and BTT have been labeled as unregistered crypto asset securities by the SEC, fueling debate over whether or not cryptocurrencies are in truth securities.

Costs for each tokens fell following the SEC cost.

“Defendants Solar provided and bought TRX and BTT as securities and have been due to this fact required to register such provides and gross sales with the SEC, until a registration exemption was accessible,” the submitting with the SEC reads. “However they by no means did.”

The SEC additionally alleged that the defendants within the case ordered the “manipulative washout commerce of TRX to create the synthetic look of reputable investor curiosity and to maintain the worth of TRX afloat.”

Moreover, the SEC famous that from mid-March 2018 to mid-February 2019, Solar and the Tron Basis provided and bought roughly 542.6 million TRX tokens to buyers, which equates to internet proceeds of over of $31.9 million for each events.

The federal government company can also be suing a handful of celebrities and influencers, together with Lindsay Lohan, Jake Paul, Soulja Boy, Austin Mahone, Michelle Mason, Lil Yachty, Ne-Yo and Akon.

“Though the celebrities have been paid to advertise TRX and BTT, their social media touts didn’t disclose that they have been paid or the quantity of their funds,” the SEC wrote within the submitting. “Thus, the general public was misled into believing that these celebrities had an unbiased curiosity in TRX and BTT, and weren’t merely paid spokespersons.”

The entire celebrities besides Soulja Boy and Mahone have agreed to pay a complete of greater than $400,000 “in restitution, curiosity and penalties” to settle the costs, with out admitting or denying their guilt over the SEC allegations.

“This case additional demonstrates the elevated threat buyers face when securities of crypto property are provided and bought with out correct disclosure,” SEC Chairman Gary Gensler mentioned in a press release. “As alleged, Solar and his corporations not solely focused U.S. buyers of their unregistered bids and gross sales, producing thousands and thousands in unlawful income on the expense of buyers, but additionally coordinated the bogus commerce on an unregistered buying and selling platform to creating the misleading look of lively buying and selling in TRX Solar additional tricked buyers into shopping for TRX and BTT by orchestrating a promotional marketing campaign during which he and his celeb promoters hid the truth that celebrities have been being paid for his or her tweets. .