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SEC fines NVIDIA for $5.5M for withholding crypto profit details

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The U.S. Securities and Exchange Commission (SEC) published a press release last May 6, 2022, regarding charges directed at the technology company NVIDIA. A $5.5 million fine has been enforced due to the company failing to disclose essential information about how crypto miners played a significant role in their revenue. 

SEC’s published statement includes specific reasons as to why the fine was enforced and how NVIDIA evaded proper disclosure of information to its investors:

‘The SEC’s order also finds that NVIDIA’s omissions of material information about the growth of its gaming business were misleading given that NVIDIA did make statements about how other parts of the company’s business were driven by demand for crypto, creating the impression that the company’s gaming business was not significantly affected by crypto mining’. 

On the other hand, the SEC’s Chief of Enforcement Division Crypto Assets and Cyber Unit Kristina Littman disclosed her take on the situation. ‘NVIDIA’s disclosure failures deprived investors of critical information to evaluate the company’s business in a key market’, she shares in the same press release published by the SEC. 

The SEC’s press release also included information about how NVIDIA had already misled its investors in the past, specifically in the 2018 fiscal year reports. Reports made by the Kotaku news platform have said that NVIDIA reported over $9.714 billion in revenue that year, only labelling it under the term ‘gaming’. 

In the years that followed after that, the NVIDIA platform continued to have an increase in revenue without investigation or sanction. This went on up until the current year when the SEC decided to step in and enforce the $5.5 million fine. 

Based in Santa Clara, California, NVIDIA is a technology company that specialises in providing integrated circuits and graphics processing units (GPUs) used for PCs, specifically for the gaming industry. However, crypto miners also use GPUs to mine digital assets, thus their products are not only used in gaming but also in crypto mining. 

There are currently no further developments or comments from the side of the NVIDIA company. 

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