SEC files ICO fraud charges

SEC files ICO fraud charges

The Securities Exchange Commission's new cyber unit has filed its first charges, winning an emergency asset freeze to stop an initial coin offering (ICO) that raised $15 million from investors.

The regulator has charged "recidivist Quebec securities law violator" Dominic Lacroix and his company, PlexCorps, which marketed and sold securities called PlexCoin on the internet to investors.

Beginning in August, the firm raised up to $15 million from thousands of investors, telling them that by putting money into PlexCoin they would yield a 1,354% profit in less than 29 days.

The SEC has charged Lacroix, his partner Sabrina Paradis-Royer, and PlexCops with violating the anti-fraud provisions, and Lacroix and PlexCorps with violating the registration provision, of the US federal securities laws.

The watchdog has also obtained an emergency court order to freeze the assets of PlexCorps, Lacroix, and Paradis-Royer.

"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," says Robert Cohen, chief of the cyber unit. "We acted quickly to protect retail investors from this initial coin offering's false promises."

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