SEC's Cyber Unit Files Fraud Charges Relating To Plexcoin ICO

On December 1, the United States Securities and Exchange Commission charged PlexCorps, a Quebec-based company, its principal executive, Dominic Lacroix and his partner, Sabrina Paradis-Royer in connection with PlexCorps' Initial Coin Offering, or "ICO," which opened on August 8, 2017 and closed on October 1.

According to the SEC's complaint filed in the United States District Court in the Eastern District of New York, Lacroix and Paradis-Royer raised investor funds illegally through the fraudulent and unregistered offering and sale of securities called the "PlexCoin" or the "PlexCoin Token" in a purported ICO. The SEC claims the defendants misleadingly lured investors by projecting a return on investment after 29 days, depending on where and when in the offering the investor purchased PlexCoin, of either 1,354%, 629%, 332% or 200%. The complaint notes that the defendants compared the supposed returns available to PlexCoin Token holders to those of other investments in ICOs and cryptocurrencies, which the defendants claimed were as high as 88,000%.

Since the initial offering of PlexCoin Tokens in August, tens of thousands of investors in the U.S. and Canada have purchased approximately 81 million tokens for a total of approximately $15 million. In addition...