ICO News: SEC launches fake ICO to highlight potential signs of fraud

The U.S Securities and Exchange Commission (SEC) has launched a pretend ICO (initial coin offer) in a bid to educate potential token sale investors on some of the tell tale signs of a fraudulent ICO. ICOs are on the rise.

ICO News: SEC launches fake ICO to highlight potential signs of fraud

In 2017, they generated $5.6 billion and this year, that figure has almost been surpassed with seven months of the year remaining.

However, the ICO space has also become a hotbed for scams. As such, the SEC has been creative in its efforts to educate potential investors.

The site looks convincing to begin with, but those of us who are familiar with the ICO scene, will soon begin to notice the cracks, so to speak.

Introducing HoweyCoin

On Wednesday, the SEC launched a mock ICO called HoweyCoin, after the Howey test (the test used to determine whether something is a security or not). The site talks about an investment offer to good to refuse before informing readers that ‘the offer isn’t real’.

Users who click on the link get redirected to the below site:

HoweyCoins

According to the HoweyCoin website, most travel businesses ‘require processing, centralized currency, and most importantly, nickel and dime fees that add up to literally billions’.

"HoweyCoin" is different because:

"HoweyCoins utilize the latest crypto-technology to allow travellers to purchase all segments without these limitations, allowing HoweyCoin users to buy, sell, and trade in a frictionless environment - where they use HoweyCoins to purchase travel OR as a government-backed, freely tradable investment - or both!"

The website goes on to report that investors will receive 1-2 percent returns, and advises them to "HODL," mimicking websites for existing fraudulent or potentially fraudulent token sales.

The site similarly features Twitter testimonials and list of its team members, though whether any of them are real is debatable - there are no social media or professional profiles linked to the names.

In a press release, the SEC said that the site includes ‘a white paper with a complex yet vague explanation of the investment opportunity, promises of guaranteed returns, and a countdown clock that shows time is quickly running out on the deal of a lifetime’.

What “HoweyCoin” says...

DON'T MISS THIS EXCLUSIVE OPPORTUNITY TO PARTICIPATE IN 

HOWEYCOINS TRAVEL NETWORK NOW!

Combining the two most growth-oriented segments of the digital economy – blockchain technology and travel, 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.

HoweyCoins will partner with all segments of the travel industry (air, hotel, car rental, and luxury segments), earning coins you can trade for profit instead of points.

Massive potential upside benefits like:

  • HoweyCoins are officially registered with the U.S. government
  • HoweyCoins will trade on an SEC-compliant exchange where you can buy and sell them for profit
  • HoweyCoins can be used with existing points programs
  • HoweyCoins can be exchanged for cryptocurrencies and cash
  • HoweyCoins can be spent at any participating airline or hotel
  • HoweyCoins can also be redeemed for merchandise

So, heed the SEC’s warning and be aware of fraudulent ICOs!

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