ICO Asset Freeze Instituted By SEC on PlexCorpsbr>
In its first major crackdown on initial coin offerings (ICO), the US Securities and Exchange Commission has obtained a court order to freeze the assets of what they are calling an “ICO fraud.”
The SEC said PlexCorps has raised approximately $15 million from thousands of investors by “falsely promising a 13-fold profit in less than a month. The ICO began in August.
The SEC’s cyber unit filed charges in a Brooklyn, New York federal court against Dominic Lacroix, described as a repeat violator of Canadian securities law; his company, PlexCorps; and Lacroix’s partner, Sabrina Paradis-Royer.
The move by the SEC underlined its new commitment toward rooting out schemes in ICOs. It indicated in July that many digital offerings may be subject to securities laws. It also briefly suspended trading in three digital currency stocks.
The Brooklyn situation “is exactly the kind of misconduct the (SEC cyber unit) unit will be pursuing,” said a statement from Robert Cohen, chief of the SEC’s Cyber Unit. “We acted quickly to protect retail investors from this initial coin offering’s false promises.”