Due to an increased number of fraudulent claims made by various companies that the SEC and CFTC support or endorse their ICOs, both agencies joined the forces to issue a public warning
explaining how this is used to mislead the investors.
The SEC and CFTC offer examples of false claims that could be used by the companies, such as:
• “Having advance knowledge of future agency actions to approve new financial products that derive their value from digital assets.
• Using the SEC or CFTC seal on promotional materials related to digital assets.
• Advertising that agency officials are working with certain digital industry participants to bring their financial products to the market.”
Either one of these statements should raise a red flag because it is false. By law, the Federal Government, including the SEC and CFTC, can never sponsor, endorse, promote, or support any particular securities, companies, products, services, etc. Therefore, you should not trust anyone who is offering you an investment and claiming any affiliation with the federal agencies.
Summarized by Katrina Arden
Attorney and founder of Blockchain Law Group