Cryptocurrency News

SEC Punishes Fake Tomahawkcoin ICO Founder With $30,000 USD Fine and Lifetime Ban

The U. S. Securities and Exchange Commission (SEC) has announced today that it had taken a step to secure new prohibitions against Tomahawk Exploration LLC, the company behind an allegedly fraudulent Initial Coin Offering (ICO) and the director of the company, David Laurence.

The measures against the CEO and the company consist of a fine of $30,000 USD and an officer-and-director bar to be put on David Laurence for a lifetime.

According to the SEC, Laurence, via Tomahawk, tried to raise funds to create something that would be called Tomahawkcoin. However, the promotion of the sale used misleading marketing materials and used blatantly false claims about how oil drilling licenses work. Therefore, the agency had no choice but to punish the company and its CEO for lying on the Initial Coin Offering.

Other lies told by David Laurence and the company was related to profits that the investors would get for holding the tokens. According to the SEC, the marketing material promised that the token owners would be able to convert their Tomahawkcoins into equity and profit from anticipated oil production and secondary trading, which was also not true.

David Laurence Decided To Pay The Penalty

After the announcement from the SEC, David Laurance and its company decided to pay the $30,000 USD penalty. However, the company did not admit or deny the SEC allegations, choosing not to talk about them instead.

Another part of the punishment is that David Laurence was punished with an officer-and-director bar. This means that he cannot act in this capacity in any public company for the rest of his life and he cannot own penny stocks because he was also punished with a penny stock bar, according to the SEC.

Robert Cohen, the leader of the SEC’s Cyber Unit, has told the media that investors should be alert of these frauds like oil and gas schemes masquerading as innovative ICOs and that they should always be ready to investigate the companies before they start investing. Make sure you read our guide on the most common ways scammers try to pull fast ones in this young, budding industry known as bitcoin, blockchain and cryptocurrency.

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