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SEC flags digital currency companies allegedly duping investors globally

The U.S. Securities and Exchange Commission (SEC) has flagged 28 companies it alleged have been soliciting investors without obtaining the required registration. Of these 28 companies, 8 have been offering digital currency services.

In its press release, the regulator revealed that it was also flagging three impersonators of genuine firms and six fake regulators. It claims that these firms have been targeting primarily non-U.S. investors using misleading information.

The alleged digital currency scammers on the SEC’s list include Axtrading Investment, SmartCoins24, RetireWell Investors and Passive Trade Plan.

One of these, Axtrading, claims to be “the world’s largest and most trusted exchange institution in the decentralized finance space.” It further claims to have processed more than $3 billion for over 1 million clients in 200+ jurisdictions. It also offers stocks, indices and commodities.

SmartCoins24 touts itself to be a globally reputable trading platform, offering BTC, ETH, Litecoin and more. Its Basic account requires a $250 deposit, with its Ultimate account going for $50,000.

The scammers have also been targeting retirees with digital currency products. One of these is RetireWell Investors, a fake firm that offers BTC trading services with a “guaranteed 3% weekly return on investment.” The minimum investment stands at $500.

These, and several other firms, were added to the SEC’s Public Alert: Unregistered Soliciting Entities (PAUSE) list. This list enables investors to better inform themselves about possibly fraudulent firms.

Commenting on the latest batch of companies on the PAUSE list, the Chief of the SEC’s Office of Market Intelligence Jennifer Diamantis stated, “By updating the PAUSE list, we continue to provide the public with information we have learned in reviewing tips, complaints, referrals, and other sources so that investors can be alerted to potential fraud before they invest.”

For years, the U.S. securities regulator has been cracking down on fraudsters and scammers especially in the digital industry. One of its most high-profile cases in recent weeks has been against Ripple, the company behind XRP. Former SEC chair Jay Clayton sued the company in December for selling unregistered securities.

Clayton’s position at the helm of the watchdog is set to be assumed by Gary Gensler as part of the Joe Biden’s administration takeover. As CoinGeek reported, Gensler is expected to enforce tougher regulations for the industry. His previous stint as the head of the CFTC saw the regulator adopt a more hands-on approach in the wake of the 2008 financial crisis.

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