The Securities and Exchange Commission has suspended another fraudulent coin offering, alleging that the operators of the “Blockvest ICO” not only violated a number of securities laws, but misled investors by claiming that they had received permission from a US regulator. According to the court decision, all Blockvest assets were frozen and their activities were suspended due to suspicion of fraudulent activities.
According to the SEC, Blockvest LLC and its founder Reginald Ringgold misled investors by providing false information about partners and the legal status of the company. In particular, to promote his own ICO, Ringgold made statements about cooperation with several large companies and regulators, including the SEC.
In addition, Ringgold, whose real name is Rasul Abdul Rahim El, distorted information about the types of products and services provided by his company, fabricated customer reviews and comments, and also invented his own non-existent agency “Blockchain Exchange Commission” to promote the ICO. Its “commission” coat of arms almost exactly matches the SEC logo.
Blockvest was touted as a next-generation decentralized cryptocurrency exchange, as well as an index fund that tracks the top 30 cryptocurrencies. According to the SEC, the company's proposal violates securities laws because exchange tokens are considered securities, which means the company must register as a broker-dealer.
The regulatory status of ICOs and cryptocurrency offerings is still quite uncertain. Despite this, the SEC has warned that securities laws may apply to some virtual tokens depending on their characteristics. In these cases, companies must register, disclose information, and comply with other requirements.
Earlier this year, the SEC's Office of Investor Education and Advocacy created a fake ICO whose website advertised an offer that was “too good to be true.” According to the regulator, such schemes bring profit to many scammers in the cryptocurrency and other markets.
According to financemagnates.com
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