A brand new unit of the Securities and Exchange
Commission has shutdown an initial coin offering
This is the first case filed by the new cyber unit,
created in September to focus on nefarious activity in the
world of crypto.
US regulators appear to be paying more attention to the opaque
world of initial coin offerings.
The Securities and
Exchange Commission announced Monday it halted a fraudulent
ICO “falsely promising” over 1,000% returns. The regulator said
this was the first case filed by its brand-new cybersecurity
unit, aptly named Cyber Unit.
Initial coin offerings, the red-hot cryptocurrency-based
fundraising method, have raised more than $3 billion this year by
some estimates. They’ve come under the scrutiny of regulators
across the world because they allow young companies to raise
quick money without, in some cases, having to disclose proper
information to investors.
As for the Monday’s case, the SEC filed charges against Dominic
Lacroix and his firm PlexCorps for soliciting $15 million from
thousands of investors.
“The Commission’s complaint, filed in federal court in
Brooklyn, New York, alleges that Lacroix and PlexCorps marketed
and sold securities called PlexCoin on the internet to investors
in the U.S. and elsewhere, claiming that investments in PlexCoin
would yield a 1,354 percent profit in less than 29 days,”
the regulator said in a statement.
The Cyber Unit, according to the SEC, was created with the
purpose of sniffing out nefarious activity in the crypto and
initial coin offering space.