Australian Securities and Investments Commission Stops Deceptive ICOs

Australia's Securities Watchdog Moves to Halt Deceptive ICOs

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  • Australia’s Securities Watchdog, ASIC, Stops misleading and deceptive ICOs.
  • ASIC specified that it would be inspecting the whitepaper of every ICO marketing.

Australia: The Australian Securities and Investments Commission (ASIC) has announced yesterday Tuesday 1st May, that it is making moves to stop every fraudulent activity in the initial coin offerings (ICOs) market. The Australian securities watchdog, in its statement published today, said the agency is “issuing inquiries to ICO issuers and their advisers where we identify conduct or statements that may be misleading or deceptive.” More so, ASIC stated that it will stop unlicensed activities as well.

ASIC stated:

“As a result of our inquiries, some issuers have halted their ICO or have indicated the ICO structure will be modified.”

Though the body did not disclose how many token sales have been canceled or changed as a result of ASIC’s actions. John Price, ASIC commissioner, stated:

“If you are acting with someone else’s money, or selling something to someone, you have obligations. Regardless of the structure of the ICO, there is one law that will always apply: you cannot make misleading or deceptive statements about the product. This is going to be a key focus for us as this sector develops.”

John made reference to the token sales on April 27, affirming ASIC’s plan to focus on overseas-based ICOs that target prospective Australian investors. John said:

“I cannot stress enough that if you are doing business here and selling something to Australians – including issuing securities or tokens to Australian consumers – our laws here can apply.”

In the statement, the securities watchdog specified that it would be inspecting the whitepaper of every ICO marketing so as to check if those behind such ICO sales are in compliance with Australian law. According to the agency:

“In one recent example, ASIC took action to protect investors where we identified fundamental concerns with the structure of an ICO, the status of the offeror and the disclosure in its white paper. In addition to potentially misleading statements in the white paper, the offer was an unregulated managed investment scheme.”

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