ICO’s are quite a legal way of raising funds for startups. Companies who have great ideas to develop usually organize ICO’s to raise money for the project they wish to undertake. Cryptocurrencies like Bitcoin and Ethereum are accepted in exchange for the new coin or token the ICO organization creates. Investors who are interested in the ICO project and believe their investment would appreciate shortly would exchange their Bitcoin, Ethereum and any other cryptocurrencies or altcoins, the ICO accepts.
While many companies have made investors in their ICO projects rich in recent times, for example, the IOTA ICO has given its investors an impressive ROI of over 700% in the last one month. Many other ICO’s have turned out to be scam projects and disappeared with investors’ money. Confido, TBC and a host of others are examples of ICO Bitcoin scam schemes.
Plex Coin ICO Scam
On September 25, 2017, the United States Securities and exchange commission(SEC) announced the launch of the cyber task force, which SEC said will be in charge of cybercrimes and scam ICOs.
In its first operation, the SEC cybercrime unit has filed charges against the founders of the Plexcoin ICO.
The Securities and Exchange Commission has said that the Canada based Dominic Lacroix and Sabrina Paradis Royer- who are the founders of PlexCorps, along with PlexCorps have violated the anti-fraud regulations connected to ICOs. The Plexcoin ICO has promised investors a massive 1,354% ROI in less than 29 days, which is a claim that looks too good to be true by all standards.
SEC has also charged the PlexCorps and its founders with violating the requirements to register the ICO with the SEC.
SEC has swiftly frozen all assets belonging to PlexCorps and its founders as announced on SEC’s website www.sec.gov/news/press-release/2017-219. The statement reads thus:
“Washington D.C., Dec. 4,2017-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.”
It is important to note that this is not the first time the organizers of the Plexcoin ICO are violating the law. As reported by CCN, in 2013, Lacroix and one of his companies had pleaded guilty to a six-count charge of illegal placement, practice and transmission of false or misleading information and they were fined 25,000 Canadian dollars.
The Sec ICO Clean-up
The entry of the Cybersecurity unit of the SEC into the ICO space is a welcomed development as many individuals like Lacroix, and his PlexCorps team who have intentions of organizing scam ICOs would have a rethink because they wouldn’t want to get into SEC’s trouble!
It remains to be seen if the Cybersecurity unit of the SEC would bring the much-needed cleanup to the world of Initial Coin offerings before it is turned into ‘Initial Scam Offerings.’