According to the SEC’s claim, for a period ranging from August 2021 to October 2022, Titan, which offers multiple complex strategies to retail investors through its mobile trading app, made misleading statements on its website regarding hypothetical performance, including by advertising “annualized” performance results as high as 2,700 % for its Titan Crypto strategy.

The claim alleges that Titan’s advertisements were misleading because they failed to include material information, for example, that the hypothetical performance projections assumed that the strategy’s performance in its first three weeks would continue for an entire year.

The SEC says that Titan breached the marketing rule by advertising hypothetical performance metrics without having adopted and implemented required policies and procedures or taking other steps required by the Commission’s marketing rule, which was amended in December 2020.

The SEC’s order further finds that Titan
(1) made conflicting disclosures to clients about how Titan's custodianship of crypto assets;
(2) included in its clients' advisory agreements liability disclaimer language that created the false impression that clients had waived non-waivable causes of action against Titan; and
(3), contrary to representations, failed to adopt policies and procedures concerning employee personal trading in crypto assets.

The claim also states that Titan self-reported to the SEC staff that it failed to ensure that client signatures were obtained for certain types of transactions in client accounts and agreed to settle related charges.

Titan has agreed to pay to settle the proceedings. Titan cooperated with the investigation and consented to the entry of the SEC’s order finding that it breached the Advisers Act. Without admitting or denying the SEC’s findings, Titan agreed to a cease-and-desist order, a censure, and to pay USD192,454 in disgorgement, pre-judgment interest and an USD850,000 civil penalty that will be distributed to affected clients.