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Shopin Founder Pleads guilty, But no Jail time

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On December 11, the SEC filed a civil fraud lawsuit against the chief executive of Shopin, Eran Eyal, for conducting a $42 million fraudulent Initial Coin Offering (ICO). Besides this, Eyal was also facing charges of fraud in connection to this previous startup dubbed Springleap, where he was accused of stealing $600,000 from investors by tricking the clueless victims into purchasing convertible notes by misrepresenting the staff and clients.

Marc P. Berger, Director of the SEC’s New York Regional Office said:

“As alleged in today’s action, the SEC seeks to hold Eyal and Shopin responsible for scamming innocent investors with false claims about relationships and contracts they had secured in support of a blockchain-based universal shopper profile […] Retail investors considering an investment in a digital asset that meets the definition of a security must be afforded the same truthful disclosures as in any traditional securities offering.”

Eyal, who is no stranger to getting in trouble with the law, had completely disappeared from all social media platforms right after the SEC’s accusation. He deleted both Facebook and Twitter accounts and disappeared from Shopin’s Telegram account where he was active regularly prior to this.

An automated message that was sent from Eyal’s email stated that he was “no longer affiliated with Shopin”. “Please contact Henrik Rasmussen, the Acting CEO at henrik@shopin.com. Godspeed, Eran Eyal.”

Now, an announcement from the office of the New York Attorney General (NYAG) Letitia James, reveals that Eyal has pleaded guilty to the felony charges against him. He has also pleaded guilty to defrauding the investors of Springleap. The plea comes a day after he was charged by the SEC. Eyal pleaded guilty on Wednesday before Justice Danny Chun of the New York State Supreme Court in Brooklyn.

The Attorney General had commented on the conviction stating:

“My office won’t allow white collar criminals to get away with their schemes to defraud innocent victims, no matter how complex […] This one individual created company after company after company just to continue cheating investors out of hundreds of thousands of dollars. Using fake product trials and nonexistent contracts with major retailers he was able to lure victims to invest in his technology schemes, including his very own cryptocurrency. We will use every available resource at our disposal to pursue all who attempt to abuse and manipulate the system because no one is above the law.”

Even though Eyal won’t be facing any jail time, he has agreed to step down as Shopin’s chief executive and has been ordered to surrender $475,000 worth of cryptocurrency assets related to Shopin and pay $600,000 to Springleap investors and pay $125,000 in restitution. Furthermore, he has received a three-year ban from raising capital and serving as an officer of a business in New York.

Anna Larsen
Anna Larsen has been a Crypto enthusiast since 2016. Fascinated by the technology and its usecases she decided to pursue a career in content creation related to this space. The journey has been exciting ever since.

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