North Dakota’s regulatory agency has once again been forced to take actions against initial coin offering projects believed to be operating without approval in the state.
Speaking on Thursday, Karen Tyler the commissioner of the regulatory agency issued cease and desist orders against three companies for offering “unregistered and potentially fraudulent securities in the form of ICOs.”
In a news release by the North Dakota regulatory agency, the departmen claimed that the three affected companies- Crystal Token, Life Cross Coin and Advertiza Holdings – had on their websites fraudulent statements with claims of unimaginable high returns, insufficient disclosures and misrepresentation of facts.
To further buttress its point, the regulatory agency noted that none of the three affected companies had registration that allow them to offer securities in the state. Also, Advertiza had falsely claimed that it had filled with the SEC. Further investigation by the regulatory agency revealed that Life Cross Coins website is operated using a Berlin IP that is famous for rasomware, Trojans and identity theft. According to Tyler, the continued exploitation of the cryptocurrency space by financial criminals possess a significant threat to investors adding that:
“In formulaic fashion, financial criminals are cashing in on the hype and excitement around blockchain, crypto assets, and ICOs – investors should be exceedingly cautious when considering a related investment.”
This isn’t the first time the regulatory agency would take serious actions against companies promoting fraudulent ICOs within the state. As a matter of fact, last month, the department took actions against companies like BitConnect, Magma Foundation and Pension Rewards Platform.
In what has been described as a bold move against fraudulent ICOs, there has been actions at the federal level to curb the activities of fraudulent projects. Just yesterday, the Securities and Exchange Commission (SEC) announced that it has concluded plans to sue an ICO project and its owners for falsely claiming to have gotten the agency’s seal of approval
The SEC is further requesting that a U.S. district court enforce a subpoena as part of a probe into alleged pump-and-dump tactics of ICO projects.