Investing is risky, as everyone knows, and that is why the chief U.S. government securities regulator, the Securities and Exchange Commission, is particularly concerned about the increasing potential of cryptocurrency fraud.
So on Wednesday the SEC decided to unveil a realistic-looking website, Howeycoins.com, to educate investors, particularly Mom and Pop investors, about what they need to know so they won’t be duped by bad actors in the cryptocurrency universe.
The Howeycoins site looks the part: an image of a luxurious hotel pool, exuberant writing. Its white paper combines vague industry statistics with grandiose claims and a dearth of executive names or profiles.
The cryptocurrency purports to be a universal medium of exchange for travel and promises to drive down costs. But when the reader clicks to purchase the coin, he or she is moved to a more official-looking SEC site and given a list of red flags that should’ve been a tipoff to a scam: claims of guaranteed returns, celebrity endorsements and claims of SEC compliance.
Caveat emptor. Read more here.