The Securities and Exchange Commission’s (SEC) new Cyber Unit has launched their first crackdown on an allegedly fraudulent ICO offering ludicrous returns. American crypto enthusiasts are breathing a sigh of relief as the SEC is focusing on scams, not legitimate projects.
The SEC Has Our Backs?
American Bitcoiners always have the SEC in the corner of their eyes. Why? Because the vanguard watchdog agency has the power to label all cryptocurrencies as securities in the United States, a dynamic that would turn crypto investing upside down in the nation.
The good news, though, is that the SEC’s been taking a protective approach to U.S. crypto investors in recent weeks.
This protective attitude just came to the fore yet again, as evidenced by a new December 4th press release in which the SEC’s declared the leveling of an emergency asset freeze against the PlexCoin Initial Coin Offering (ICO):
“The Securities and Exchange Commission today announced it obtained an emergency asset freeze to halt a fast-moving Initial Coin Offering (ICO) fraud that raised up to $15 million from thousands of investors since August by falsely promising a 13-fold profit in less than a month.”
“The SEC filed charges against a recidivist Quebec securities law violator, Dominic Lacroix, and his company, PlexCorps. 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 SEC also charged Lacroix’s partner, Sabrina Paradis-Royer, in connection with the scheme.”
SEC files charges against ICO fundraisers. "The ICO for the PlexCoin Tokens was an illegal offering of securities because there was no registration statement filed or in effect during its offer and sale, and no applicable exemption from registration" pic.twitter.com/4mIqu0sN6S
— Owen Davis (@odavis_) December 1, 2017
New SEC Cyber Unit Makes First Strike in the Crypto Sphere
First created back in September, the SEC’s new, so-called “Cyber Unit” was explicitly designed to be able to tackle the type of complex, cutting-edge issues that are inherent to brave new world of revolutionary technologies.
To this end, the crypto ecosystem is case and point. So it’s fitting for the Cyber Unit’s first successful operation came against a maliciously fraudulent scamcoin.
Per Robert Cohen, the inaugural Chief of the Cyber Unit:
“This first Cyber Unit case hits all of the characteristics of a full-fledged cyber scam and is exactly the kind of misconduct the unit will be pursuing […] We acted quickly to protect retail investors from this initial coin offering’s false promises.”
The takeaway? This certainly won’t be the last scamcoin the Cyber Unit sets its eyes on. Overall, this reality is perhaps a good thing for the space, as more naive investors should be routinely protected by SEC crackdowns on the future’s inevitable scamcoins.
On the other hand, some users will be anxious over the SEC’s intensified presence in the crypto space. The agency’s newfound involvement begs the question: what else will they find that they don’t like? And will their “likes” line up with the broader and general goals of the ecosystem?
SEC Warned Investors About Scams Just Weeks Ago
Back on November 1st, the SEC released an unexpected warning to American investors to watch out for ICOs that “sound too good to be true.”
Well, in offering 13-fold profits in less than a month, PlexCoin definitely fit that bill. Now they’re paying the price, literally.
Other scamcoin startups be warned then, both the ones here now and the ones to come. You’re playing with fire by potentially drawing the ire of the world’s most far-reaching financial watchdog.
Accordingly, it looks like the enemy of our enemies is our friend at present. Will that dynamic hold forever? Who knows. At least the SEC’s protective mood is promising for now.
What’s your take? Is the SEC’s crackdown on PlexCoin good, bad, or neither? Let us know where you stand in the comments below!
Images via PlexCoin.com, wccftech