US Markets Watchdog Sues Scam ICO for Falsely Claiming its Approval

There’s no dearth of clever scammers in the world. We’ve seen instances like GainBitcoin in which scammers lured innocent people by showing fake documents related to affiliation with several government departments and agencies, and also used celebrities to promote their schemes. However, such instances are certainly not limited to India and other emerging market economies alone. Even in developed economies scammers take advantage of people’s ignorance and claim to have the support of government to lure innocent people into investing their hard earned money into these scams. One such scam has recently been shot down by Securities and Exchange Commission (SEC) of United States.

That’s right. Blockvest, a crypto startup that claimed to have obtained the green light from SEC for its ICO, and its founder Reginald Buddy Ringgold, have just been sued by SEC for falsely representing the facts and claiming the permission of markets watchdog to run its ICO. The agency said in its lawsuit:

“They [Blockvest] were using the SEC seal without permission, a violation of federal law, and falsely claiming their crypto fund was ‘licensed and regulated. Blockvest and Ringgold also allegedly misrepresented Blockvest’s connections to a well-known accounting firm, and continued their fraudulent conduct even after the National Futures Association (NFA) sent them a cease-and-desist letter to stop them from using the NFA’s seal and from making false claims about their status with that organization.

The website of Blockvest had claimed in June that it has received Reg A+ approval from SEC for its exempted sale of BLV tokens worth $100 million. Public records show that while the company had filed with SEC to obtain approval for this sale, the markets regulator had not given any sort of green light as company claimed on its website. SEC further added in its complaint:

“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. The SEC does not endorse investment products and investors should be highly skeptical of any claims suggesting otherwise.”

Now a hearing is scheduled for 18th of October in US District Court for Southern District of California. This is second such action taken by the SEC. Prior to this, the markets watchdog had also issued subpoena to the team behind another $100 million ICO accused of running a pump-and-dump scam.

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