North American Securities Administrators Association (NASAA) Investigating ICOs for Fraud
Operation Cryptosweep and the ICO Market
Since beginning a crackdown on fraudulent ICO’s with “Operation Cryptosweep” in May 2018. The body has engaged in 190 active ICO fraud investigations, up from 75 just a few months ago.
In 2018 alone, ICOs have raised a total of $11 billion up from $7 billion in 2017, the majority of which comes from “mom and pop” retail investors. Statistically, this group of investors is the most likely to fall victim to fraud.
Inevitably, this unfortunate merger of opportunity has seen the ICO boom come with a substantial risk of fraud. Between last year and the present, several exit scams and Ponzi scheme ICOs have successfully raked in millions of dollars. This all looks set to change as the policing on the crypto fundraising space in North America tightens up.
Due to NASAA. There are a number of actors within the ICO space who do not agree with the company ability. So they can act in a regulatory capacity over ICOs.
The SEC on its part refuses to budge, stating in June that while it considers bitcoin and ether to be utility tokens, it still considers the majority of ICOs to be security sales which are subject to its jurisdiction. SEC Chairman Jay Clayton reiterated this in an interview with CNBC where he said:
“If it’s a security, we’re regulating it.”
NASAA (1919) Is the world’s oldest cross-border organization dedicated to protecting investors. Since launching Operation Cryptosweep across the 67 states, provinces and territories in Canada, Mexico, and the U.S. that are part of the association, NASAA has successfully concluded 46 enforcement actions against fraudulent ICOs and related products.