Why Was ICOBox Sued by the SEC in the First Place?
Without digging into legal technicalities, ICOBox was selling tokens as unregistered securities to unaccredited investors and breaching securities laws. So it’s no surprise the SEC sought justice.
As expert Michel Wein Layne said, "By ignoring the registration requirements of the federal securities laws, ICOBox and Evdokimov exposed investors to investments, which are now virtually worthless, without providing information that is critical to making informed investment decisions." True, ICOBox's digital tokens the company was promoting, called ICOS tokens, are worthless now.
Here we should mention that ICOBox is not the only company sued for fraud. Given that regulations are still catching up with technologies, the SEC keeps seeking clarity and has warned many projects, including Airforx and Gladius Network, that it would treat ICOs as unregistered securities sales.
Why Is This Story Important?
While spotting fraud years ago might have been difficult, the story of ICOBox and the report by the SEC that took years to reach an effective ruling of the court are relevant today.
Why? Because researching ICOs is crucial to help you limit losses as you risk losing your entire capital.
Always do your research.
Read the whitepaper available.
Make sure the team is reputable and compliant with all the local rules and regulations.
Once again, when it comes to ICOs in the US, remember that the SEC has repeated numerous times that virtual assets should comply with US securities laws and the 1933 Securities Act. So carry on due diligence!
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