SEC Launches Its Own Scam ICO
The U.S. Securities and Exchange Commission (SEC) launched a website to promote the non-existent and scam ICO by HoweyCoin. Thus, the regulator hopes to visually demonstrate to potential crypto investors how the unconditional tokensale campaign looks clearly.
The regulator called mock ICO HoweyCoin due to the method in American law developed by the US Supreme Court to determine whether a financial transaction is related to investment activities called "Howie Test".
According to the SEC, HoweyCoin demonstrates a campaign that is too good to be a real prospect for investment. At the same time it is noted that actually the project doesn't exist. Users who are trying to invest really money redirected on the page SEC designed to warn against scam tokensales.
According to website:
"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."
Potential investors are also promised a profit of 1-2% per day. In addition, they are encouraged in every possible way to "hodl" their tokens.
Similarly, the page presents the members of the imaginary team, but to check whether any of them exist in reality, it is not possible - links to pages in social networks or summaries are not tied to names, as is customary in the ICO world.
The SEC press release also notes that the project has a "White Paper" with a complicated but very vague description of the reasons to invest money in their project, as well as with guaranteed profit promises and a countdown timer, after which visitors are supposed to miss the best offer in their life.
The chief adviser of the Department of Education and Investors Protection, SEC Owen Donley also noted that on the HoweyCoin website, the agency tried to collect all the "alarm bells" inherent in fraudulent tokensales.
Scammers can quickly build an attractive website and load it up with convoluted jargon to lure investors into a phony deal. But fraudulent sites also often have red flags that can be dead giveaways if you know what to look for.” Donley summed up.
Recall that at the Consensus 2018 conference in New York these days representatives of several American regulators said that their departments do not really want to stick sticks in the wheels of the crypto industry.