Monday, 27 January 2020

New Jersey Issues Emergency Orders To Two Online Crypto Promoters

The New Jersey Bureau of Securities has issued two emergency cease-and-desist orders against two online cryptocurrency promoters for offering unregistered securities in the state of New Jersey. The orders were issued against Zoptax LLC and Unocall as part of "Operation Cryptosweep."

The Bureau found the two online cryptocurrency-related investment entities fraudulently offering investors unregistered security in the form of an Initial Coin Offering (ICO) of their respective tokens or coins through their websites.

The Zoptax and Unocall securities were not registered with the Bureau in New Jersey, nor exempt from registration. The Bureau found that both entities further violated the law by making materially false and misleading statements and/or omitting to state material facts in connection with the offer and sale of its securities.

The actions are part of probably one of the largest coordinated international crypto-crackdowns being conducted by state and provincial securities regulators in the U.S. and Canada since April 2018 on ICOs and other cryptocurrency-related investment products.

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The crackdown is conducted in coordination with the North American Securities Administrators Association (NASAA), with 44 jurisdictions participating from the U.S. and Canada. The New Jersey Bureau is a member of NASAA and its Chief Christopher Gerold serves as NASAA's President-Elect.

Since January, the international crackdown has already resulted in nearly 130 new inquiries and investigations and 35 completed enforcement actions involving ICOs or cryptocurrency-related investment products.

Since inception in April 2018, there have been approximately 330 inquiries or investigations by securities regulators from U.S. states and Canadian provinces, which has resulted in at least 85 pending or completed enforcement actions.

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