The SEC issues another warning to investors on the SEC approved offerings
The SEC Office of Investor Education and Advocacy issued an investor alert warning the investors against false statements regarding the SEC “approved” issuance of securities. In this document, the SEC explained how fraudsters can mislead the investors by claiming the following:
1. Submission of the documents to the SEC.
The SEC clearly states that submission of any documents by a company does not mean an approval. The SEC cannot and does not “approve” an investment. The SEC only ensures that the companies comply with the law in regards to their disclosure obligations. The SEC does not evaluate whether the issued securities are a “good” investment. Investors should make their independent judgement in evaluating the investment opportunity.
2. Use of forms to lure the investors.
The SEC warns that fraudsters my use various official forms to make false declarations regarding registration with the SEC or security issuance approved by the SEC. They may use the statements of “formal registration with the SEC” to make their offering more attractive to investors. Investors should check the SEC’s EDGAR database to verify registrations.
To summarize, when you see a claim that the SEC has approved any ICO, it should be a sign of fraud. No official government agency in the U.S., including the SEC, has an authority or power to approve any coin offerings. It is a good idea to verify all information prior to investing in securities.
April 30, 2019