CEO of controversial mining firm Riot Blockchain resigns

09 Sep, 2018
by David Robb
CEO of controversial mining firm Riot Blockchain resigns

The CEO of Riot Blockchain has resigned, after the SEC brought new fraud charges against him. These charges are unrelated to the controversy surrounding Riot Blockchain, which is apparently involved in cryptocurrency mining.

The SEC has already been investigating Riot Blockchain since April, in the wake of some suspicious activity. The company, which was formerly involved with bio-technology, rebranded itself to Riot Blockchain in September 2017, when the crypto craze was really starting to take hold. Its stock price subsequently increased from $8 to $40 in a matter of days.

Read more: SEC investigates 'Riot Blockchain' crypto mining company

CEO John O'Rourke has now resigned, after joining the company in November 2017. No reason was officially given, but it closely follows unrelated SEC charges being brought against him and others for several allegedly fraudulent schemes. This group also included Barry Honig, who was formerly Riot's largest shareholder.

According to a press release from the commission, "Honig orchestrated his and his associates’ acquisition of a large quantity of...issuer’s stock at steep discounts, either by acquiring a shell and executing a reverse merger or by participating in financings on terms highly unfavorable to the company." The SEC characterised the actions as "highly profitable ‘pump-and-dump’ schemes".

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