U.S. SEC’s cyber unit files charges in alleged initial coin offering fraud

WASHINGTON (Reuters) – The U.S. Securities and Exchange Commission said on Monday its newly created cyber unit had filed its first charges against an “initial coin offering” (ICO), alleging that a privately held company called PlexCorps and its top two officials had defrauded investors.

The SEC said in a statement that it had obtained an emergency order to halt the PlexCorps ICO, which had raised up to $15 million from thousands of investors since August by falsely promising a 13-fold profit in less than a month.

The explosive growth of ICOs, a capital-raising tool that uses bitcoin and other cryptocurrencies to fund projects that leverage technologies such as blockchain, has sparked concern among regulators who say such schemes lack transparency.

The cryptocurrency market is watching closely to see how regulators respond to ICOs, which SEC Chairman Jay Clayton has said closely resemble new company initial public offerings – implying they should be regulated just as tightly…

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