Monday, July 15, 2019

Colorado Regulatory Body Suspends Four ICOs For Regulation Violation

Cessation order has been filed by the Colorado division of securities against four ICOs initial coin offerings considered to be involved in fraudulent and illicit practices. The Colorado Securities Commissioner Gerald Rome signed the order on the 20th of November.

Cessation Order Against Four ICOs In Colorado

A new cessation order against four ICOs signed by the Colorado securities commissioner takes the total number of orders signed to 18. While two more orders are still pending, the cessation orders arrive at after the investigation of the ICO task force that was convened within the regulatory agency in May. This was saddled with the responsibility of investigating potentially fraudulent activity targeting investors.

The four firms allegedly involved in the fraudulent and illicit ICOs are Global Pay Net, Credits LLC, CrowdShare Mining, and CyberSmart Coin Invest. The cessation order has been signed against them for their violation of the state law in operation.

The commissioner Rome noted that the sheer number of orders entered against ICOs should be a red flag to all investors that there is a risk that the ICO they are considering is a fraud. He further stated that investigations show that there are fraudsters who are willing to create a fake ICO to steal investors money or spoof a legitimate ICO to trick investors into a wrongfully paying them.

Fraudulent and Illicit Practices of The Firms

Global pay net is a company markets its ICO with a promise of investors to get 80 percent of the company’s profit and also listing of multiple Cryptocurrency professional which the regulators stated that two had denied association with the ICO. Also, claim of filing with the United States Securities and Exchange Commission’s EDGAR database could not be verified.

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Also, crowdshare mining promised investors a yield of 1000 percent for those that that bought the token of CSM at the beginning.

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Cybersmart promised its investors 20 to 35% profit every month. The firm stated that it would utilise a robot to trade on bitmex.Com and other Crypto exchanges and use secret methods of profit gaining.

Prevalence Of Fake ICOs

Prevalence of fake ICOs has virtually made the Crypto space unsafe for investors with many losing their investment. Also, it is impeding the full growth of the industry.

Regulators have stepped up the game against fraudulent ICOs of recent. On the 19th of November, Italian securities regulators Commissione Nazionale per le Società e la Borsa (CONSOB) issued enforcement against three Crypto related firms for alleged violation of financial laws.

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Jide Idowu
I am Jide Idowu. A stay-at-home dad and a cryptocurrency enthusiast. I have had my hands on freelance writing for over five years, researching and writing guides, reviews, and latest cryptocurrency news for various blogs and individuals world over.
 

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