the The Texas State Securities Board is investigating cryptocurrency exchange FTX, its subsidiary FTX.US, and founder and CEO Sam Bankman-Fried for possible securities violations. That’s according to a recent court filing, first reported by Barrons’ media on Monday.

Regulators are investigating whether yielding accounts offered by FTX.US should be considered unregistered securities, as outlined in a filing on crypto lending platform Voyager Digital’s bankruptcy proceedings. In the recent past, the FTX exchange won the bid to acquire the lender’s assets.

Joseph Jason Rotunda, chief compliance officer for Texas State Securities, made the remarks in a filing with the bankruptcy court overseeing the potential sale of Voyager Digital’s assets to the FTX exchange.

The director said that FTX may be violating state law governing the registration and sale of securities products as it currently offers a yielding product to US users.

Rotunda revealed that he was able to set up an account through the FTX app to earn a return on his Ether (ETH) deposit and transfer funds from his linked bank account. According to Rotunda, the app stated that it was eligible for a performing account, even though the company’s terms and conditions said that FTX would not offer services to US customers.

The director explained that FTX allows users to earn up to 8% APY on the first $10,000 deposited and up to 5% APY on amounts over $10,000 and no more than $10 million. Despite the offers, Rotunda said that FTX.US has not registered to offer or sell securities in Texas.

But an FTX spokesman responded to the allegations, saying the company had already been “in discussions” with Texas regulators. He said that FTX has an active application for a license that has been pending, and said that the company is operating fully within the limits of what it can do in the meantime.

On September 27, FTX won the bid to buy the assets of Canada’s Voyager Digital, the bankrupt digital asset lender, for $1.4 billion. Voyager is also under investigation by regulators for its profitable accounts, which may be considered unregistered securities, according to Rotunda. The report revealed that FTX is seeking to reimburse Voyager users affected by the company’s sudden closure.

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