Texas regulators have been viewing cryptocurrency investment programs as a risk for Main Street investors for some time and continue to warn publicly of possible crypto scams during the COVID-19 pandemic.
The latest move by the Texas State Securities Board (TSSB) is Action Not Words – an order to cease and desist from emergencies against a company that is abusing the Binance name.
According to an announcement made on March 15, the deal is targeting a company that claims to operate out of the UK that has previously received a warning from securities regulators in the Philippines. They had already warned that Delta Crypt “is illegally selling securities that pay” ridiculous “returns,” and warned the public to stay away.
Since then, the company has apparently ditched its previous name, Delta Crypt, and launched an online investment program that is not registered for the sale of securities in Texas. Various misleading brands such as Binance Assets, BinanceAssets Ltd and Bit Kind Ltd. used TSSB summarized the schemes:
“The playing field is relatively simple – invest a little, win a lot, and don’t worry about risks. In fact, the ‘Gold Plan’ pays a guaranteed return of 30% and the ‘Diamond Plan’ a guaranteed return of 40%. “
The TSSB has determined that these offers are “fraudulent and misleading” and that Delta Crypt has hidden important information from its clients, including prior intervention by Philippine government agencies. It has also failed to warn investors of the risks associated with cryptocurrency investing and illegally solicited its sales agents. This latter point implies that the company is required to pay commissions regardless of registration requirements or license.
The TSSB has been relatively active against fraudsters in the crypto room, recently issuing orders in September 2020 against two suspected scams punishable by fines of $ 10,000 or two to ten years in prison, or both.
