SEC Files Charges Against Alleged ICO Scam PlexCoin
Citing marketing materials that claimed investors can net a 1,354 percent gain in their holdings in under 29 days, the SEC charged Quebec inhabitants Dominic Lacroix and Sabrina Paradis-Royer, together with PlexCorps — Lacroix’s firm — with violating anti-fraud regulations joined to the ICO. Lacroix and PlexCorps were also charged with violating the need to enroll all of securities offerings using the SEC.
Based on an SEC announcement, PlexCorps had increased up to $15 million in the PlexCoin ICO, which started in August. The Commission has got a crisis asset freeze from PlexCorps while the case is litigated.
These are the initial charges filed with the SEC’s new cyber task force, which started in September to fight a variety of cyber-related risks including ICOs.
“This first Cyber Unit case hits all of the characteristics of a full-fledged cyber scam and is exactly the kind of misconduct the unit will be pursuing,” said Robert Cohen, chief of the cyber unit, in a statement. “We acted quickly to protect retail investors from this initial coin offering’s false promises.”
The SEC also asks that the court pub the PlexCoin ICO organizers by providing electronic securities in the long run. Labelling Lacroix a “recidivist…securities law violator,” the criticism eventually seeks to pub Lacroix from functioning as a director or officer of a public business.
Since CCN reported in October, Lacroix along with another PlexCoin organizers had already run afoul of the Autorité des marchés financiers (AMF), Quebec’s main financial regulator. On October 20, the Quebec Superior Court held Lacroix in contempt for violating the earlier ruling that barred him and his affiliated companies from holding an ICO in or soliciting investors by the state.
But, that wasn’t Lacroix’s first run-in together with the AMF. In 2013, he and a few of his firms pleaded guilty to six counts of “illegal positioning, illegal clinic, and transmission of false or misleading information” and were fined $25,000 CAD.