American Retail Group ICO Ordered to Suspend Trading After Fake SEC Registration Claims
American Retail Group Ordered to Suspend Trading After Claiming to Be Registered with SEC
In a press release on October 22nd, the Securities and Exchange Commission announced that the American Retail Group would not be able to continue their trading services for an undisclosed amount of time. The company recently held an initial coin offering (ICO), claiming that it had been registered in adherence to the SEC requirements, and that they were partnering with a claimed SEC-qualified custodian for use with cryptocurrency transactions.
None of the claims, which occurred in August 2018, are true. According to the Enforcement Division Cyber Unit's chief, Robert Cohen,
“The SEC does not endorse or qualify custodians for cryptocurrency, and investors should use vigilance when considering an investment in an initial coin offering.”
Based on the current laws regarding federal securities, the stock can be suspended for up to 10 days. The press release also indicates that the laws “generally prohibit a broker-dealer from soliciting investors to buy or sell the stock again until certain reporting requirements are met.”
Surprisingly, this is actually the second time that the SEC has been forced to take action this month against a company that has toted the false approval of the regulatory entity. Almost two weeks ago, they had to get an injunction against BlockVest and their proprietor, Reginald Buddy Ringgold. They claimed that their ICO was registered with the SEC, and even used the SEC’s seal to make it seem valid.
To provide more education regarding the best ways to maintain safety in the evolving industry, the press release concludes by saying,
“The SEC’s Office of Investor Education and Advocacy has issued an Investor Bulletin on initial coin offerings and a mock ICO website to educate investors. Additional information about ICOs is available on Investor.gov and SEC.gov/ICO.”