Friday, 22 June, 2018


SEC uses mock website to warn investors about cryptocurrency

SEC uses mock website to warn investors about cryptocurrency SEC uses mock website to warn investors about cryptocurrency
Conrad Doyle | 17 May, 2018, 16:28

The SEC's spoof ICO launch, HoweyCoins website breaks down the red flags of fraudulent fundraising to educate potential victims.

"Combining the two most growth-oriented segments of the digital economy, blockchain technology and travel, Howeycoin is the newest and only coin offering that captures the magic of coin trading profits AND the excitement and guaranteed returns of the travel industry", the mock SEC website reads, "Howeycoins will partner with all segments of the travel industry (air, hotel, auto rental, and luxury segments), earning coins you can trade for profit instead of points".

As a final push to investors, the HoweyCoins.com website mentions investors can expect returns of 1% to 2% per day - similar to the returns offered by many lending scams and similar fraudulent ICOs online.

SEC Chairman Jay Clayton was positive about the project and was effusive about the site's potential to reduce the possibility of investor scams, saying, "The fact that our staff could put together something that looks just like an ICO in very little time and with very little resources shows how little you have to put into this to market a token".

Celebrity endorsement: "It is never a good idea to make an investment decision just because someone famous says a product or service is a good investment".

And it is also more than ironic how "on it" the SEC has been when it comes to crypto and all things ICO.

Earlier Wednesday, one of the lead enforcers at the SEC told members of Congress that ICOs are now among among the "greatest threats" to mom-and-pop investors.

According to the HoweyCoin website, most travel businesses "require processing, centralized currency, and most importantly, nickel and dime fees that add up to literally billions".

Claims of SEC compliance are also reason to give an offering a second look. SEC created a bogus hedge fund offering in 2003, called "GRDI Select LP", the name is a reference to greedy. The securities regulator also created a dedicated cyber unit whose objective is to combat fintech as well as cyber-related crimes. Others are more subtle-like the warning against investing with credit cards.

The SEC has yet to approve any public ICO sales, as the agency feels they should comply with certain rules, like giving investors audited financial statements and descriptions of the business and its risks.

Pump and dump scams: In these schemes, scammers spread misleading information to create a buying frenzy that will "pump" the price of an asset higher, allowing them to "dump" it by selling their own shares at the elevated price. While cryptocurrency supporters say rules like these go against the objective of the business models of token-selling, the SEC says operating under the current system is illegal.

"I am not a fan of overt regulation - but damn, SEC, this is clever and beneficial to the #crypto market". "P.S. don't invest in Howeycoin lol".

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