A platform falsely claiming to have SEC approval has been charged by the commission who, in turn, plans to halt its upcoming ICO and bar its founder from offering securities in the future.

The world of ICOs is a busy one, and if you’re in the U.S., it also involves the Securities and Exchange Commission (SEC). The commission has been cracking its whip against platforms who fail to follow its prescribed processes. This includes registering with the agency once it is confirmed that the currency in question is indeed a security.


SEC Gives Platform the Cold Shoulder

However, according to an SEC press release, one company believed that they could cheat the system. Blockvest LLC and its founder, Reginald Buddy Ringgold III, who is also known as Rasool Abdul Rahim El, made some bold claims when it came to promoting the platform. Because of these assertions and investor feedback, the commission has charged Ringgold with “violating the antifraud and securities registration provisions of the federal securities laws.”

In addition to stating that Blockvest’s ICO had received the go-ahead from the commission and was fully “licensed and regulated,” Ringgold also promoted it through a fictitious agency called the Blockchain Exchange Commission. The fake commission used a similar logo to that of the SEC and also used the same address as the agency.

The Chief of the SEC Enforcement Division’s Cyber Unit, Robert A. Cohen, set the record straight, stating:

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.

ICO fraud

Consequences of Fraud

The platform also reportedly used the seal of the National Futures Association (NFA) in a further attempt to legitimize the business. The NFA later issued Blockvest with a cease and desist notice.

The SEC has filed and subsequently obtained an emergency court order to stop the platform’s upcoming ICO and to halt any pre-ICO funding efforts. The commission is also hoping to have injunctions implemented and to have Blockvest return any funds that they received. In addition, the commission wants to bar Ringgold from offering any securities in the future.

A hearing for the case is scheduled to be held on the 18th of October.

What fate do you think awaits Blockvest? Do you think we’ll see more false claims of SEC-approved ICOs? Let us know in the comments below!

Images courtesy of Pixabay and Shutterstock.

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