The US Securities and Exchange Commission (SEC) has filed a lawsuit against an ex-employee of the demised cryptocurrency mining outfit GAW Miners.
The Federal Agency has accused Carlos R. Garza of violating a subpoena in relation to their ongoing investigation into GAW Miners and its CEO Josh Garza. The investigation is to know whether the company was engaged in fraud by selling unregistered securities through Hashlet mining products and cryptocurrency PayCoin. SEC is also investigating whether GAW was a Ponzi company, as reported by many of its investors.
According to the legal notice obtained by CoinDesk, Carlos Garza — who was actively involved in orchestrating the sales of the aforementioned securities with his brother Josh Garza — appeared for testimony but was not cooperative in answering any of the questions. He also failed to produce the documents that were requested in the subpoena. He had been reported to have produced one of them previously.
“Garza had two options: (1) testify, or (2) invoke a valid privilege not to do so,” the filing stated. “He did neither. Garza refused to provide any substantive testimony and further refused to assert any valid privilege. He claimed that because he did not understand the securities laws, he felt scared and intimidated and therefore would not answer any questions.”
Thereby, the SEC requested the court to issue a show-cause order explaining why Carlos should not comply with the administrative subpoena. The agency further requested the court to order the respondent to appear for testimony in their Boston’s office.
The court permitted the aforementioned requests on August 17th.