A California-based company has refunded tokens sold in a $15 million initial coin offering following an investigation by the U.S. Securities and Exchange Commission (SEC).

The SEC announced today that Munchee Inc. had provided refunds to investors after officials made contact and drew issue with its token sale, which the agency said constituted the offer and sale of unregistered securities.

The development represents the latest high-profile move by the agency to regulate initial coin offerings, coming roughly a week after the SEC filed a fraud suit against the organizer of the PlexCoin token sale. As in that instance, today's order resulted from an investigation by the SEC's Cyber Unit, formed earlier this year in part to police token sales that involve U.S. investors.

Munchee, according to a thread on Bitcointalk, was pitched as a "Yelp Meets Instagram" that would serve as a new way to source restaurant reviews. Its MUN token, materials suggest, would serve as an incentive for activity on the company's social network, and the sale began in October, according to the post.

Yet in its cease-and-desist order, dated Dec. 11, the SEC argued that the MUN tokens constitute securities because "they were investment contracts." The document later notes that the tokens were ultimately deemed a security regardless of their "utility" when the sale took place.

"Even if MUN tokens had a practical use at the time of the offering, it would not preclude the token from being a security. Determining whether a transaction involves a security does not turn on labelling[sic] – such as characterizing an ICO as involving a 'utility token' – but instead requires an assessment of 'the economic realities underlying a transaction,'" the SEC wrote in the order.

While it's not clear how much money was raised, the SEC said that "about 40 investors" bought tokens through the sale. The agency also noted that it first contacted Munchee on the second day of the sale and that it "did not deliver any tokens to purchasers."

In statements, the agency pointed to the swift cooperation by Munchee after it began investigating the sale.

''In deciding not to impose a penalty, the Commission recognized that the company stopped the ICO quickly, immediately returned the proceeds before issuing tokens and cooperated with the investigation," said Stephanie Avakian, co-director of the SEC's Enforcement Division.

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