Regulators Across The United States and Canada Launch Crypto Scam Probes Under “Operation Cryptosweep” 9645
Sharat Chandra
May 22, 2018 at 12:22 AM

Securities regulators across the United and Canada wreaked havoc on unscrupulous cryptocurrency investment products today. More than seventy investigations were opened in one go, and more are expected in the coming days.

The Tennessee Department of Commerce & Insurance (TDCI) pledged its support for the global crackdown on counterfeit Initial Coin Offerings and investment products related to cryptocurrencies. As a party to "Operation Cryptosweep," TDCI agreed to publicize a series of consumer education alerts during the week of May 21-25 to increase awareness and caution when putting money in cryptocurrencies.

“Fraudulent activity involving ICOs and cryptocurrency-related investment products is a significant threat to Main Street investors in Tennessee,” said TDCI Commissioner Julie Mix McPeak. “Cryptocriminals need to know that we are committed to swiftly and effectively protecting investors from schemes and scams involving these products.”

TDCI has collaborated with more than 40 other state and provincial securities regulators in the United States and Canada in “Operation Cryptosweep". The partnership has shown results. Close to 70 inquiries and investigations and 35 pending or completed enforcement actions have been initiated since the beginning of the month.

“The actions announced today are just the tip of the iceberg,” said TDCI Assistant Commissioner Frank Borger-Gilligan, highlighting that NASAA’s task force has red-flagged 30,000 crypto-related domain name registrations. A significant chunk of these websites cropped up during the period 2017 and 2018.

The North American Securities Administrators Association (NASAA) commenced “Operation Cryptosweep” on May 1. Texas, which initiated its targeted investigation of cryptocurrency offerings in the year 2017, took charge in conceptualizing, managing, and clinical execution of the NASAA sweep.

“Although the task force’s work is far from complete, my suspicions have already been confirmed,” said Joseph Rotunda, Director of the Enforcement Division of the Texas Securities Board and the Vice-Chair of the Enforcement Section for NASAA. “The market for cryptocurrency investments is saturated with widespread fraud, and our work is only revealing the tip of the iceberg.”


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