RYVYL, Fredi Nisan and Benzion Errez told investors their company used proprietary blockchain to settle every transaction. For nearly five years, it resold credit card processing to cannabis dispensaries while hiding that from the public and their own banking partners.
On April 27, 2026, the Securities and Exchange Commission filed a settled action against Fredi Nisan, 44, of San Diego, and Benzion Errez, 65, of Escondido, California, co-founders of RYVYL, Inc., memorializing a resolution reached in 2025 over a multi-year course of materially false disclosures that ran from October 2020 through May 2025. What investors were told: a cutting-edge financial technology company with proprietary blockchain infrastructure, a digital token ecosystem, and a diversified merchant base across 50 industries. What the company actually was: an independent sales organization reselling conventional credit card processing services, primarily to cannabis dispensaries, whose card transactions were explicitly prohibited by Visa, Mastercard, and American Express. RYVYL itself faces no monetary penalty under the settlement and made no admission of wrongdoing. The penalties fall on the two founders personally. The complaint was filed 26 days after RYVYL shareholders had already voted to approve the company’s merger into a media technology firm, effectively ending its existence as an independent public company.
From an Art Auction to a Nasdaq Listing Built on Blockchain Claims
The company began on June 13, 2017, as GreenBox POS, LLC. Nisan brought point-of-sale software experience; Errez arrived with a technology career that included time at Intel and Microsoft. They launched the company, by their own account, out of Errez’s gym. A reverse merger in April 2018 put GreenBox on OTC markets under the ticker GBOX. The founders raised $1.6M in seed capital and then, on January 29, 2021, completed an underwritten public offering through EF Hutton, raising $51M and uplisting to the Nasdaq Capital Market.
The S-1 registration statement filed with the SEC on October 2, 2020 established the investor thesis that would persist for four and a half years: GreenBox was “a tech company formed with the intent of developing, marketing and selling innovative blockchain-based payment solutions,” and its “proprietary blockchain-based technology serves as the settlement engine for all transactions within its ecosystem.” The filing also described a digital token system through which consumers would purchase tokens, load them onto virtual wallets, and conduct what RYVYL called a seamless blockchain-settled transaction. Those descriptions repeated across annual reports, quarterly filings, and Form 8-K press releases until May 2025. In October 2022 the company rebranded as RYVYL with the ticker RVYL, changing nothing about the underlying claims.
The Blockchain That Appeared in Every Filing and Processed No Transactions
The SEC’s complaint is direct. RYVYL was an independent sales organization that resold credit card and ACH processing services of third-party processors. None of those processors used blockchain technology. None of the independent sales organizations RYVYL acquired had any blockchain component. Transactions cleared through conventional bank-affiliated payment gateways, the same infrastructure behind any ordinary credit terminal.
RYVYL’s QuickCard Payment System did record transactions to a private blockchain after a bank processor approved them. But the approval, clearing, and settlement occurred entirely outside that blockchain. Neither merchant nor customer had any access to or interaction with it. The private blockchain itself was built by a third-party software developer whose technology RYVYL did not license and could not claim as its own. The company employed no software developers with blockchain development experience. As for the digital token system detailed across dozens of filings, the SEC found RYVYL never implemented it. No tokens were sold. No virtual wallet system existed. The $51M raised on Nasdaq was attracted, in substantial part, by a product description that was false from the day it was filed.
Cannabis Dispensaries, Banned Card Networks, and the Banking Crisis RYVYL Blamed on Compliance
RYVYL’s public filings described 1,500 business customers across North America, Europe, and Asia in over 50 industries. Its 2024 annual report cited that diversity as a core risk management strategy. QuickCard, the company’s primary product, was marketed exclusively to cannabis dispensaries.
Cannabis remains federally illegal. Visa, Mastercard, and American Express all prohibit their card networks from processing cannabis sales and bar affiliated banks and gateways from handling those transactions. Nisan, according to the complaint, was directly involved in establishing banking relationships that let QuickCard process major cards without disclosing to the networks that the underlying sales were cannabis. Errez signed merchant processing agreements that misrepresented the products those merchants sold.
When banking partners identified RYVYL’s cannabis business and terminated their relationships, processing volumes in North America fell sharply. In its fiscal year 2023 annual report, RYVYL disclosed that the banking change caused consolidated revenue to fall approximately 30 percent sequentially in Q1 2024, attributing it to “recent changes in the compliance environment and banking regulations.” The real cause, the SEC found, was RYVYL’s cannabis merchant activity violating its banking partners’ explicit prohibitions. The company did not acknowledge the cannabis connection in any public filing until its quarterly report dated May 20, 2025.
Financial Restatements and the Class Action That Preceded the SEC’s Complaint
Investors first learned RYVYL’s financials were unreliable in January 2023. On January 20, the company announced that financial statements for fiscal year 2021 and multiple 2022 interim periods could no longer be relied upon and required restatement, with decreases to revenue, assets, and stockholders’ equity. RYVYL’s stock fell 14.6 percent on the news, closing at $0.70. A securities class action followed, captioned Cullen v. Ryvyl Inc., No. 23-cv-00185 (S.D. Cal.), alleging materially false statements throughout the company’s public life. That case settled in February 2025 for $300,000 in cash and 700,000 shares.
Nisan stepped down as CEO on October 31, 2025. Errez left as chairman and executive vice president in August 2025. By September, RYVYL had entered a merger agreement with RTB Digital Inc. Shareholders approved the transaction on April 1, 2026, 26 days before the SEC filed the complaint memorializing the resolution.
Conclusion
The settled SEC complaint permanently bars Nisan and Errez from serving as officers or directors of any public company for five years and requires each to pay a civil penalty of $230,464. RYVYL as a company paid no monetary penalty and admitted no wrongdoing. For more than four years, the two founders filed public disclosures describing blockchain technology the company never built, a token system it never deployed, and a merchant base it never had. The banking partners who terminated RYVYL knew the real business before the investing public did. The investors who bought shares on the Nasdaq did not find out until the company was already gone.
Editor’s note: This article was updated on April 30, 2026 to clarify that the SEC filed a settled action, not new charges; to correct the date of the RYVYL shareholder vote, which took place April 1, 2026, 26 days before the complaint was filed; and to note that RYVYL as a company faces no monetary penalty under the settlement and made no admission of wrongdoing.
