In a stern action on Thursday, the U.S. Securities and Exchange Commission (SEC) announced that it has put a lid on a planned Initial Coin Offering (ICO) that seems to have falsely claimed to have got the regulator’s nod.
In a press release on Thursday, the regulatory authority said, “It has obtained an emergency court order halting a planned initial coin offering (ICO), which backers falsely claimed was approved by the SEC. The order also halts ongoing pre-ICO sales by the company, Blockvest LLC and its founder, Reginald Buddy Ringgold, III.”
According to the complaint:
“Blockvest and Ringgold, who also goes by the name Rasool Abdul Rahim El, were using the SEC seal without permission, a violation of federal law, and falsely claiming their crypto fund was ‘licensed and regulated’. The complaint also alleges Ringgold promoted the ICO with a fake agency he created called the ‘Blockchain Exchange Commission’, using a graphic similar to the SEC’s seal and the same address as SEC headquarters.”
The release further goes on to add the fraudulent firm misrepresented its association with a well-known accounting firm and carried on with its fraudulent activities even after getting a cease-and-desist notice from the National Futures Association (NFA).
After the regulatory authority’s complaint, the U.S. District Court for the Southern District of California issued an order freezing defendants’ assets and other emergency relief. The order also temporarily prohibits Blockvest and Ringgold from violating the antifraud provisions and securities registration provisions.
“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,” said Robert A. Cohen, Chief of the SEC Enforcement Division’s Cyber Unit.
1Broker starts processing withdrawals
The regulatory authority has started to turn on the heat on entities indulging in fraudulent activities. In one such move last month, the SEC charged 1Broker, a Bitcoin futures trading platform, with violating the securities law by engaging in a Bitcoin security swapped scheme. Charges were filed against the Marshall Islands-based 1pool Ltd or 1Broker, and its CEO Patrick Brunner for engaging in the sale of security-based swaps, which comes under the purview of futures, to domestic and international investors.
In a surprising move, the trading firm announced on Wednesday that it will begin processing customer withdrawals from 11 October 2018.
We will start processing withdrawals tomorrow at 12:00 (UTC). Thanks for your patience in the past days!
— 1Broker (@1Brokerio) October 10, 2018
This might come as a surprise to many since the trading platform was shut down by the United States Securities and Exchange Commission, Federal Bureau of Investigations (FBI) and the Commodity Futures Trading Commission (CFTC). But it’s a welcome move for customers who can now withdraw their money.
Image via Shutterstock
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