Maryland Securities Division Participating in Operation Cryptosweep

News, Regulation | August 15, 2019 By:

Maryland Attorney General Brian E. Frosh has announced that his Securities Division is now participating in “Operation Cryptosweep.”

Operation Cryptosweep, launched by the North American Securities Administrators Association (NASAA) in May 2018, is a task force aimed at cracking down on unregistered and fraudulent crypto-related investment products. NASAA members from more than 40 jurisdictions throughout North America have participated in the initiative, which to date has resulted in more than 330 inquiries and investigations and at least 85 enforcement actions.

In a press release, Frosh said that the Maryland Securities Division has initiated an enforcement action against a bitcoin trading platform, which led its investors to believe they could earn as much as 150% through passive
investments, and a Maryland resident who sold investments in the trading platform.

“Cryptocurrency investments are risky. Investors should be extra cautious when dealing with promoters who claim their offering does not have to be registered with securities regulators,” said Frosh. “Quick returns of 150% are as rare as Bigfoot. Make sure to do independent research the product before you invest. Be aware of the risks, and contact the Maryland Securities Division with any concerns before parting with your hard-earned money.”

Frosh noted that not every crypto-related investment offer is a fraud, but he said it is important for individuals and companies selling these products to understand that state and provincial laws or regulations may apply to these sales, especially securities laws.