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SEC cyber unit files charges over Quebec Plexcoin securities

SEC cyber unit files charges over Quebec Plexcoin securities

The U.S. Securities and Exchange Commision (SEC) announced in a press release the acquisition of an emergency court order with intent to freeze the assets of the PlexCoin ICO.

According to Reuters, the SEC also said that it had obtained an emergency order to stop the ICO and freeze assets so they could attempt to refund investors. "We acted quickly to protect retail investors from this initial coin offering's false promises".

The SEC's complaint, filed in a federal court in NY, alleges that Dominic Lacroix of PlexCorps marketed and sold securities called PlexCoin on the internet to investors in the United States and overseas, claiming the investments would yield a 1,354 percent profit in fewer than 29 days.

According to an SEC statement, PlexCorps had raised as much as $15 million from the PlexCoin ICO, which began in August.

The regulator said this was the first case filed by its brand-new cybersecurity unit, aptly named Cyber Unit. The charges are the result of regulatory collaboration with the Autorité Des Marchés Financiers (AMF).




PlexCorp has so far not gotten back to us for comment but has issued a statement on its Facebook page, telling fans it was "being depicted as robbers, scammers and fraudsters everywhere in the media". In October, Quebec's Superior Court declared the company and Lacroix in contempt of court, finding the defendants continued to market and solicit investments in PlexCorps.

Charges against the company, described by the agency as a "scam" run by a "recidivist Canadian securities law violator", were brought by the SEC's new cyber unit as it looks to crack down on potential abuse in the cryptocurrency arena.

As per the SEC complaint, Lacroix, Paradis-Royer, and PlexCorps have been charged with violation of anti-fraud provisions. In 2013, he and one of his companies pleaded guilty to six counts of "illegal placement, illegal practice, and transmission of false or misleading information" and were fined $25,000 CAD.

Lo and behold, the SEC cyber unit's first case is yet another indication they plan on subjecting ICOs to the same securities laws as traditional investment products.

The SEC complaint was filed in federal court in Brooklyn, New York, and it seeks permanent injunctions, disgorgement plus interest, and penalties. Lacroix proceeded with the offering despite being enjoined by Quebec securities regulators and has "misappropriated or attempted to misappropriate at least $200,000 ... on extravagant personal expenditures", the commission said.


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