SEC Cyber Unit’s first charges target cryptocurrency fraud
The Securities and Exchange Commission’s new Cyber Unit has filed its first charges since being formed in September. The unit’s case is being brought against a company called PlexCorps, its founder Dominic Lacroix and his partner Sabrina Paradis-Royer and the SEC claims that Lacroix and Paradis-Royer were actively defrauding investors. PlexCorps was engaged in an initial coin offering (ICO) — which was selling securities called PlexCoin — that had already raised around $15 million since August and it was fraudulently promising that investors would see a 13-fold profit in just under one month. The SEC obtained an emergency asset freeze to halt the ICO.
The SEC’s charges seek permanent injunctions, a release of all funds collected so far as well as interest and penalties. In a statement, Robert Cohen, head of the Cyber Unit, said, “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. We acted quickly to protect retail investors from this initial coin offering’s false promises.”