The United States government’s leading financial regulatory authority ‘SEC’ flagged a series of unregistered cryptocurrency related businesses for apparently duping mostly international investors with false information.
Among the 28 suspect investment firms the United States SEC [Securities and Exchange Commission] called out Thursday, & found eight that appear to focus on would-be cryptocurrency investors. Some purport to be trusted newcomer trading hubs; others peddle their services to retirees. One even fashions itself as a firm that will assist against crypto fraud.
Flagged firms AxTrading-Investment, Passive Trade Plan, RetireWell Investors, Reclaws International Inc. and SmartCoins24 all offered cryptocurrency and blockchain services on their websites Thursday. Three other entities whose websites were down, BitminingFX, Cryptobravos and FXBitcash, also made the SEC’s blacklist.
The entities’ websites appear to combine welcoming rhetoric and sweeping claims in their efforts to woo investors. Passive Trade Plan’s described itself as “a trusted authority on digital currency investing” while Smartcoins 24 promised to “trade the most well liked coins of 2018.”
“Our bitcoin [BTC, -11.14%] trading services is suitable for those that are new to the cryptocurrency ecosystem, also as for bitcoin experts and large-scale bitcoin investors,” read the web site for AxTrading-International.
The SEC added on Thursday that investors have filed complaints against all 28 flagged entities. These firms “use misleading information to solicit primarily non-U.S. investors,” SEC explained. It said it added the firms to its warning list, called PAUSE, to assist investors “avoid being a victim of fraud.”
The SEC periodically warns the investing public against too-good-to-be-true opportunities within the cryptocurrency space. Also earlier notices have detailed fraud in IEO [Initial Exchange Offerings] and cases of public firms pumping their value with ICOs. Earlier in 2014, the agency warned that investors should avoid getting swept up within the bitcoin hype machine.
Those clear-eyed warnings may take a sharper form with a new securities sheriff likely coming to Washington. President Joe Biden has tapped Gary Gensler, the crypto-savvy former head of fellow investments regulator the CFTC [Commodities & Futures Trading Commission] to steer the SEC.