Published: Tue, December 05, 2017
Money | By Armando Alvarado

SEC's cyber-cops cyber-file cyber-first cyber-fraud cyber-charges

SEC's cyber-cops cyber-file cyber-first cyber-fraud cyber-charges

Another $810,000 was about to be made available to Lacroix and Paradis-Royer prior to the SEC's action to place a freeze on the accounts.

In its official release, the SEC said that it has filed charges against Dominic Lacroix, and his company, PlexCorps, who were involved in the marketing and selling of securities called PlexCoin.

Lacroix's PlexCorps company and his "romantic partner", Sabrina Paradis-Royer, were also named as defendants in a civil complaint in which the SEC says Lacroix enticed investors by claiming that if all 400 million PlexCoin tokens for sale were sold, they would reap returns of 1,354% in 29 days or less.

The emergency action, filed with the U.S. District Court for the Eastern District of NY, freezes the assets of PlexCorps, Lacroix and Paradis-Royer.

A Canadian cryptocurrency company that raised $15 million by promising investors a whopping 1,354 percent return on their money in just 29 days has been sued by U.S. regulators for ripping off its customers. However, experts have warned they can present several dangers to unsuspecting investors hoping to get into a hot new market as regulations are pretty loose.

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Governor Doug Ducey visited the Phoenix Coding Academy on Monday to kick off Computer Science Education Week. According to Hadi Partovi, founder and CEO of Code.org, 10 million girls now have accounts on the site.

The move by the SEC underlined its new commitment toward rooting out schemes in ICOs. The alleged scam promised its investors a highly unrealistic 13-fold return on investment in less than a month.

"This first Cyber Unit case hits all of the characteristics of a full-fledged cyber scam and is exactly the kind of misconduct the unit will be pursuing", said Robert Cohen, chief of the SEC's cyber unit. The unit was created was back in September to focus on cyber-related crimes, including ICO scams. The first thing on its agenda was likely always going to be initial coin offerings-a form of nearly totally unregulated investment vehicle in which investors trade things of real value, like cash, in exchange for stakes in cryptocurrency-backed startups. The complaint seeks permanent injunctions, disgorgement plus interest and penalties.

Despite promises to investors that funds raised from the ICO would go to the company as it worked to expand PlexCoin and create new products, the SEC found the money instead went directly into the pockets of Lacroix and his partner.

The agency recommends that people considering an investment in an ICO should do their research, look for a company's SEC filings in the EDGAR system and be wary of any ICO claiming to be "SEC-compliant" without explaining how the offering complies with securities law.

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