SEC Encourages Investor Protection Through Parody ICO

SEC Encourages Investor Protection Through Parody ICO

Okay, that's not actually true, but the agency has constructed a clever campaign meant to teach investors how to identify ICO scams - and troll the fraudsters who continue to operate them.

As interest in cryptocurrencies continues to expand, this has sparked a new industry. The Office of Investor Education and Advocacy at the US Securities and Exchange Commission has launched a fake ICO site, according to a press release on May 16.

The SEC had its own presence at the conference.

The US-based regulator built the website to highlight the dangers of investing in ICOs.

HoweyCoins says it combines the "blockchain and travel" to offer ICO participants massive discounts on travel expenses.

"HoweyCoin is the newest and only coin offering that captures the magic of coin trading profits AND the excitement and guaranteed returns of the travel industry", explains the website.

"The rapid growth of the "ICO" market, and its widespread promotion as a new investment opportunity, has provided fertile ground for bad actors to take advantage of our Main Street investors,"said SEC Chairman Jay Clayton".

The website reveals that HoweyCoin is now in the middle of its ICO presale, giving investors just a little more than two weeks to purchase their tokens at a 15 percent discount.

The SEC's spoof ICO launch, HoweyCoins website breaks down the red flags of fraudulent fundraising to educate potential victims. It features a countdown clock showing how much time is left to get in on the discounts and outlines different levels of investment against images of tropical islands and foaming champagne. By creating a scam ICO that seems literally too good to be true.

Even the name is a clever act of trolling: "Howey" is a reference to a famous Supreme Court case that sets out a test for determining if an investment product is a security that must be registered. However, anyone who should stumble across it and decide to click "Buy Coins Now" after being impressed by the testimonies of its fake Twitter stars @McWhortle, @realdrummerstar and @boxingchamp1934 will be led instead to investor education tools and tips from the SEC and other financial regulators.

While many within the crypto world regularly express their discontent with regulatory bodies and see them as stifling the industry, this latest move from the SEC will no doubt serve as an important warning to would-be investors, and might at least raise a smile from the regulator's detractors. The four-part test, established in 1946, ascertains whether or not a transaction is an investment contract or security.

However, the company notes, "the offer isn't real".

Related Articles

  • Cisco Earnings: A Slight Beat, a 4% Slide

    Cisco Earnings: A Slight Beat, a 4% Slide

    The hedge fund run by Michael Novogratz is holding 844,575 shares, compared to the 748,150 from the previous quarter. The firm has a market capitalization of $215,391.23, a P/E ratio of 20.85, a P/E/G ratio of 3.20 and a beta of 1.14.
    Child among dead from powerful northeast storms

    Child among dead from powerful northeast storms

    A woman in Chestnut Ridge has died after a tree dropped onto her auto while she was driving in Tuesday's storm, police said. Utility crews with Central Hudson Gas and Electricity were out in full force working to restore power.
    Europa League final: 'cold-blooded' Griezmann wins trophy for Atletico

    Europa League final: 'cold-blooded' Griezmann wins trophy for Atletico

    The truth is this was a dream for me, to win a trophy with Atletico, with [Diego Simeone] and my friends and teammates. The French club's hopes faded after Payet went off injured in the 31st with what appeared to be a thigh injury.
  • JD Martinez, Xander Bogaerts power Red Sox past Athletics, 6-3

    JD Martinez, Xander Bogaerts power Red Sox past Athletics, 6-3

    The 25-year-old shortstop is swinging at 48 percent of the pitches he sees this year, up big from 42 percent last year. In a strong, but short, outing, Sale threw 102 pitches and walked a season-high four batters.
    BCCI announces squads for Women's T20 Challenge match

    BCCI announces squads for Women's T20 Challenge match

    The one-off encounter will have 26 players, which includes 10 worldwide players from Australia, New Zealand and England. This development comes in the backdrop of BCCI and CoA mulling a potential T20 league for Women cricketers in India.
    Buhari approves N10bn for rehabilitation of Benue communities

    Buhari approves N10bn for rehabilitation of Benue communities

    Responding, the vice-president said, "My Lord Bishop, you said you are not a politician, I am also not a politician". But we cannot bring back the dead but we can make life more bearable for the living.
  • Christine Lampard announces she's pregnant with first baby

    Christine Lampard announces she's pregnant with first baby

    See a list of celebrities who posed naked and pregnant for magazines and more scandalous nude celeb baby bump photos. Broadcaster Christine Lampard and her husband, Frank, are expecting their first child together.
    Cosmo DiNardo pleads guilty in Bucks County slaughters

    Cosmo DiNardo pleads guilty in Bucks County slaughters

    Last July, DiNardo lured the men to his family's 90-acre farm in Solebury Township under the guise of selling marijuana. Potash called DiNardo a "perfect example of someone who started at the top and worked your way down to the gutter".
    Ride of Silence pays tribute, spreads awareness

    Ride of Silence pays tribute, spreads awareness

    The rain didn't dampen the spirits of dozens of cyclists ahead of the highly anticipated " Ride of Silence ". The ride is meant to honor those who have been killed on Texas roads and raise awareness for their cause.
  • No decision on Justice KM Joseph as yet

    No decision on Justice KM Joseph as yet

    Legal experts asked why the collegium, having "unanimously agreed" to reiterate his name, should wait till the others are picked. It had then also chose to consider the names of other High Court Judges for elevation as judges of the Supreme Court.
    Prince William's children get starring roles at brother's wedding

    Prince William's children get starring roles at brother's wedding

    Her future father-in-law, Prince Charles, is also a contender with odds of 2/1, as is Prince William and Prince Philip. Both were expected to meet Queen Elizabeth II and other senior royals in the days before the wedding.
    President Kenyatta signs the Computer misuse and Cybercrime bill into law

    President Kenyatta signs the Computer misuse and Cybercrime bill into law

    Earlier, Esipisu had promised CPJ that presidency would consider reservations raised about the Bill before signing it into law. This Bill amends various provisions of the Public Trustee Act, bringing it into conformity with the Constitution.