Former US Securities and Exchange Commission (SEC) official Marc Fagel has raised concerns about the agency’s recent Wells Notice issued to Ethereum-based Web3 gaming company, Immutable. The notice, which signals potential enforcement action, was reportedly delivered without the customary preceding investigation, a departure from standard procedure that Fagel characterizes as “risky.”
Immutable claims the notice arrived with limited explanation and without prior communication from the SEC. This contradicts the typical process, which involves months of interviews and communication between the agency and the company under scrutiny before a Wells Notice is issued. Fagel emphasized the unusual nature of this approach, suggesting that bypassing the established investigative process carries potential risks.
The Wells Notice, received by Immutable last month, alleges violations of securities laws. The SEC also sent letters detailing the alleged violations to Immutable CEO James Ferguson and the Digital Worlds Foundation, which played a role in issuing Immutable’s IMX token.
