Operation Crypto Sweep to Crack Down on Investment Schemes Across US and Canada
More regulatory news out of the US as provincial and state watchdogs up and down the country – and in Canada- are getting tough on crypto investment schemes. The announcement was made at a North American Securities Administrators Association (NASAA) event.
Joseph Borg, the NASAA President, said:
We’re putting ourselves in the shoes of investors. We’re seeing what’s being promoted to investors. And then we’re taking the next step and then we’re finding out whether they’re complying with securities laws.
70 investigations are already underway, with around a third completed, and several resulting in cease and desist orders. An example of this is BTCrush, which was found to be using stock footage. And investigators are concerned that ICOs are still tricking thousands of unsuspecting investors out of their money. Joseph Rotunda, Director of Enforcement at the Texas State Securities Board, said:
Although the international task force’s work is far from complete, my suspicions have already been confirmed: the market for cryptocurrency investments is saturated with fraud, and our work is only revealing the tip of the iceberg.
A Sustained Attack
While not every ICO is a fake or a scam, there are several that are, and several more that have been irresponsibly or insufficiently structured and set up. Now, the regulators’ tasks across the US and Canada are to compile a list of thousands of ICOs, investigate them, and shut down the dangerous ones.
This news follows the SEC’s renewed attempts to educate the public through its own fake ICO site, Howeycoins, which demonstrates just how style over substance can reel people in. As the notion of crypto investment is so new, and there is such a level of decentralization, this leaves opportunities open for fraudsters to cash in, and it is now the sizeable task of regulators to ensure that it doesn’t get any further out of hand.