NEW YORK (Reuters) – Riot Blockchain Inc, a former biotechnology company that saw its stock prices rise when it focused on cryptocurrencies, appointed a new CEO after the company's former boss was accused of involvement in fraud.
The company said in a statement on Saturday that its chief operating officer, Chris Ensey, will take over from the company after the Securities and Exchange Commission that appointed former CEO John O & # 39; Rourke as one of the numerous people involved in a long running microchip pump-and-dump scheme.
The SEC said the plot involved manipulating the share price in three unidentified companies, generating over $ 27 million from illegal sales and leaving retail investors with "virtually unnecessary securities."
The SEC also appointed Barry Honig, a former Riot principal shareholder, among the people involved in the scheme, states that Honig has engaged in manipulative activities after taking over ownership interests in corporations. The attorneys of Honig and O & # 39; Rourke did not respond to requests for comment.
Riot Blockchain was not accused of making a mistake. The company's shares have fallen by 24% on Friday. The company did not immediately respond to a request for comment.
O & # 39; Rourke resigned as chief executive and chairman and was replaced by Riot's current chief executive, Remo Mancini, in the chairman's role, according to the statement.
Report by Trevor Hunnicutt; Editing by Peter Cooney