The Securities and Exchange Commission (SEC) initiated public administrative proceedings against Luis F. Serrano.
Between January and October 2022, Serrano solicited investors to invest in crypto-asset securities in the form of Venture Agreements for CryptoFX, LLC (“CryptoFX”), handled investor funds, advised investors on the merits of the investments, and received compensation based on transactions in the form of commissions for the sale of crypto asset securities.
CryptoFX is not registered with the Commission in any capacity. The respondent was not registered as a broker-dealer or an affiliate of a registered broker-dealer and was therefore acting as an unregistered broker.
On April 8, 2024, a consent judgment was entered against Serrano permanently enjoining him from future violations of Sections 5(a) and (c) of the Securities Act of 1933 (“Securities Act”) and Section 15(a) of Securities Exchange Act of 1934 (“Exchange Act”).
The Commission’s complaint alleged that during the relevant period, Serrano worked as a salesperson for CryptoFX, offering and selling securities in the form of Venture Agreements, and also supervised other CryptoFX salespeople in the offering and sale of CryptoFX Venture Agreements.
The complaint also alleged that the offering of CryptoFX Business Agreements was not registered with the Commission and that Serrano was not registered with the Commission as a broker or affiliate of a registered broker-dealer. The complaint also alleged that during the relevant period, Serrano received transaction-based compensation in the form of commissions and bonuses.
Accordingly, the SEC ordered that Serrano be barred from working with any broker, dealer, investment adviser, municipal securities dealer, municipal councilor, transfer agent or nationally recognized statistical rating agency, with the right to apply for readmission after two years in the appropriate self-regulation or, if there is none, in the Commission.
Pursuant to Section 15(b)(6) of the Exchange Act, Serrano is prohibited from participating in any offering of penny stocks, including: acting as a promoter, prospector, adviser, agent or other person engaged in activities with a broker, dealer or issuer for the purpose of issuing or dealing in any penny stock, or causing or attempting to cause the purchase or sale of any penny stock, with the right to apply for readmission after two years to the appropriate self-regulatory body, or if there is none, to the Commission.