If you want to set up a scam, cryptocurrency outfit in Texas, your chances are slim to none that you’ll be successful.
That’s because the state has been zealously going after such entities. Its most recent action is entering two emergency orders to shut down alleged scammers.
This brings the number of actions taken by the Texas Securities Board to nine.
Specifically, the orders were entered by the Texas Securities Commission.
Let’s discuss.
Crypto mining mess
The first action relates to a cloud-based cryptocurrency mining operation that was using phony videos to “falsely depict mining farms it does not own,” said Joe Rotunda, the Director of the Texas State Securities Board Enforcement Division.
The Enforcement Division found that BTCRUSH promised investors they could earn 4.1% interest on a daily basis through its cloud-based cryptocurrency mining program.
The promoter showed investors videos that purported to depict three of its sophisticated mining farms to support its claims. The agency’s investigation revealed, however, that BTCRUSH’s videos were fraudulent and they did not depict the promoter’s cryptocurrency mining farms, Rotunda said.
1000% gains!
The second action targeted a scheme in which the players were attempting to capitalize on the intersection of the cryptocurrency and forex markets. The promise was exorbitant returns without disclosing any basis for its claim.
This scheme can be considered one of the oldest frauds in the book: promising the world, but providing little or no real basis for the claim, Rotunda said.
The two players named in the scheme are Jason Butcher and Richard Dunn. Their promise was that they could quickly generate an unbelievable 1000% return through their trading program.
They left out the disclosure part related to providing the material information necessary for potential investors to ascertain the veracity of their pledge, Rotunda said.
He added:
“Investors should remember that guarantees of excessive or unrealistic returns ring hollow unless promoters support their claims with material, relevant information. On the other hand, anyone can say anything about anyone or anything on the internet. Investors should be wary of promoters who may be falsifying information to add legitimacy to claims of profitability.”
Don’t mess with Texas
There’s little doubt that the number of administrative actions the state takes against promoters of illegal or fraudulent securitized cryptocurrency investments will continue to grow.
Rotunda said:
“The entry of these administrative actions demonstrates our continued commitment to protecting investors while fostering an environment where legitimate businesses are able to embrace new technologies and grow in the new market.”
This article appeared first on Cryptovest
