The US Securities and Exchange Commission(SEC) recently halted initial coin offering(ICO) and sought an emergency court order for producing fake SEC approval.
The news came into light when SEC told in a statement, Reginald Buddy Ringgold, founder of Blockvest LLC allegedly lured prospective investors that the company is “registered” with SEC and obtained all the approvals from the agency.
In fact, this is a mere act of – ‘federal law violation for falsely claiming their crypto fund was licensed and regulated.’ The excerpt of complaint statement is mentioned below.
Blockvest and Ringgold claim their ICO has been ‘registered’ and ‘approved’ by the SEC and other regulators, even going so far as to use the SEC’s seal to promote their offering. None of that is true: the SEC has in no way approved, authorized or otherwise endorsed defendants, their entities, nor their ICO. Defendants also claim they are “partnered” with and “audited by” Deloitte Touche Tohmatsu Limited (“Deloitte”)-which they are not
The claim also highlights that Ringgold has created a hypothetical company called ‘Blockchain Exchange Commission’ purporting it to be a government agency. Interestingly, the logo also matches to that of SEC agency.
In this regard, a court hearing is scheduled on Oct 18, in the U.S. District Court for the Southern District of California.
Notably, the Robert A. Cohen, Chief of the SEC Enforcement Division’s Cyber Unit quoted that,
“We allege that this ICO is using both the SEC seal and a made-up crypto regulatory authority to trick investors into believing the ICO was approved by regulators,”
He also added that,
“The SEC does not endorse investment products and investors should be highly skeptical of any claims suggesting otherwise.”
Incidents like these are typical examples of pitfalls an investor can fall for and had the SEC not obtained a stay order on ICO proceedings, Ringgold would have continued to market his cryptocurrency token through fraudulent means.
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