The U.S. Securities and Exchange Commission (SEC) on Wednesday said it had settled charges against Akazoo S.A. for $38.8 million after the firm allegedly defrauded investors out of tens of millions of dollars.
Akazoo, a music streaming business based in Greece, went public via a special purpose acquisition company in 2019. The SEC froze Akazoo’s assets a year ago as part of an investigation into claims made by the company.
According to the SEC, Akazoo told investors it was a rapidly growing music streaming company focused on emerging markets with over 38.2 million registered users, but in reality, the company had no paying users and negligible revenue.
An attorney for Akazoo, which did not admit or deny the SEC’s findings, declined to comment.
Akazoo agreed to a judgment in April 2021 that prevents the company from violating antifraud and reporting laws. The settlement, announced on Wednesday, orders Akazoo to disgorge $38.8 million in ill-gotten gains that will be go to investor victims and settlements related to private class action lawsuits.