The U.S. Securities and Exchange Commission (SEC) has charged Shopin and its founder Eran Eyal with fraud after a $42 million initial coin offering.

The SEC announced Wednesday that Eyal had been charged with defrauding investors by selling unregistered securities in the form of Shopin Tokens. While Eyal was supposed to develop a platform which would store and track customer profiles across different retailers, Shopin never built out the system, the agency alleged.

Instead, Eyal “misappropriated investor funds for his personal use,” which included a dating service.

Eyal is accused of misappropriating at least $500,000 for his personal use.

A complaint alleges that Eyal “made at least four misrepresentations in marketing” the Shopin token, including by claiming that Shopin had successfully conducted a pair of pilot programs, that the company “had ongoing partnerships” with multiple retailers, that an unnamed “prominent Silicon Valley blockchain entrepreneur” was an advisor to the company and that an unnamed company was an investor in the project.

Eyal also pled guilty to criminal charges brought by the New York Attorney General’s office, the release said.

According to a press release shared with CoinDesk on Thursday, Eyal pled guilty to operating three securities fraud schemes, including the Shopin ICO.

Roughly $450,000 in an undisclosed cryptocurrency will be turned over to the New York State Attorney General’s office as part of the plea agreement, and Eyal will step down from his role as CEO of Shopin.

He will pay $125,000 in restitution and $475,000 in judgments to investors in Springleap, one of his previous enterprises. Former NYAG Barbara Uunderwood charged him with stealing $600,000 from the company’s investors in 2017.

The SEC is also charging Eyal with failing to register the Shopin token sale as a securities sale, and is looking for a permanent injunction, disgorgement, civil penalties, to permanently bar Eyal from acting as an officer or director in any public company, or from participating in any future token sales.

Current NYAG Letitia James reportedly began investigating Shopin and Eyal as far back as June 2019, according to Ventureburn.

Eyal reportedly shared the names and email addresses of his investors with the investigators at the time.