Sep 30, 2017

SEC charges two "initial coin offerings" with fraud

BTC Keychain / Flickr CC

The U.S. Securities and Exchange Commission has charged two companies and the man operating them for fraud in their respective "initial coin offerings." Maksim Zaslavskiy, who runs real estate-backed REcoin Group Foundation and diamond-backed DRC World (also known as Diamond Reserve Club), made false statements about the companies to investors, according to the commission.

Key quote: "Investors should be wary of companies touting ICOs as a way to generate outsized returns," said Andrew M. Calamari, director of the SEC's New York Regional Office, in a statement. "As alleged in our complaint, Zaslavskiy lured investors with false promises of sizeable returns from novel technology."

Go deeper: Earlier this summer, the SEC issued its first warning about token sales and initial coin offerings.

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