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The US Agency takes action against the alleged token swindler



The SEC has brought what appears to be its first charges against a company utilizing the initial coin offering (ICO) fundraising model.



01.Oct.17 2:34 PM
By Daria Zaytseva
Photo Toinnov.com

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The US Agency takes action against the alleged token swindler

In a press release issued late last night, the US securities regulator accused two companies and their founder, businessman Maxim Zaslavskiy of violating the anti-fraud laws and registering federal securities laws.

It was assumed that Zaslavskiy sold cryptocurrencies backed by assets that did not exist in two token sales, one for a project called Diamond Reserve Club World, and another for an effort called the REcoin Group Foundation, the SEC said.

As evidence of the claims, the SEC stated that ICO of REcoin was purportedly meant to raise funds for investing in real estate.

According to the SEC, DRC World announced that it would invest in diamonds, and would provide its investors with discounts on products, but the company did not invest in diamonds or have any business operations.

Both companies and Zaslavskiy's assets were frozen in an emergency court by the federal district court in Brooklyn, New York.

Overall, the SEC announcement is the latest indication that the agency is paying more attention to the Wild West of ICOs. Earlier this week, the regulator stated that it had created two new units focused on police cybercrimes, including violations related to the distributed book and ICOs, and protecting mom-and-pop investors.

SEC is now looking for companies to pay fines in addition to the return of all raised funds. In addition, the SEC is seeking to prevent Zaslavskiy from participating in any digital securities offerings in the future.

The investigation is ongoing.




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