The US Securities and Exchange Commission (SEC) has taken action against the fourth Initial Coin Offering (ICO) in the past four months, effectively signaling the end of an era on the cryptocurrency market where shady ICOs have dominated this year’s news cycle.
The subject of this criminal complaint is PlexCorps, a company that in August 2017 announced an Initial Coin Offering for a new cryptocurrency it was developing named PlexCoin.
An ICO is akin to an IPO, but with cryptocurrency instead of money and tokens instead of shares.
PlexCorps promised to use the money it raised in the ICO to pay staffers and experts to build the PlexCoin currency. PlexCorps allowed users to buy PlexCoin tokens with other cryptocurrencies, tokens which the company promised to exchange at a later time with its new Ethereum-based PlexCoin cryptocurrency.
The company claimed that users could have a return-on-investment of 1,354% in the first 29 days after PlexCoin launched.
SEC says PlexCorps execs misappropriated ICO funds
The SEC wasn’t impressed with PlexCorps’ investment scheme, which, in hindsight, resumed to “give us digital money for a product we don’t have and we pinky-promise to deliver later on.”
The agency intervened yesterday and asked for an emergency asset freeze of PlexCorp and its two founders, Dominic Lacroix and Sabrina Paradis-Royer.
This is an emergency action to stop Lacroix, a recidivist securities law violator in Canada, and his partner Paradis-Royer, from further misappropriating investor funds illegally raised through the fraudulent and unregistered offer and sale of securities called “PlexCoin” or…