According to the Emergency Cease and Desist Order, Coins Miner is manipulating its email solicitations to make them appear as if they came from established companies.
Texas Securities Commissioner Travis J. Iles has taken an emergency action to stop the activities of a cryptocurrency-related scheme. The Commissioner entered a cease and desist order against Coins Miner Investment Ltd., a cryptocurrency investment promoter operating in Russia.
Coins Miner was found to have been soliciting funds from Texas residents by pretending to represent Coinbase, a San Francisco-based company that operates an online platform for buying, selling, and storing digital currency.
Ana Julia Lara, a person affiliated with Coins Miner, falsely claims to work at Coinbase as a cryptocurrency trader. Lara has been sending prospective investors a photograph of herself with the president of Ripple, a cryptocurrency and transaction company, but the person identified as Lara is a vice president of CoinTelegraph Media Group. Coins Miner has also misappropriated a video of a Fortune journalist to promote its offering.
The solicitation directs prospective investors to a website maintained by Coins Miner, where the company offers investments in programs related to the mining of cryptocurrencies. On the site Coins Miner makes numerous fraudulent misrepresentations to try to make its investment offering appear legitimate.
The company claims it is based in the United Kingdom, but it operates in the Russian city of Volgograd, the Order says.
The Commissioner says that Coins Miner investments are securities under Texas law, but the offerings are not registered for sale in Texas and neither Coins Miner nor Lara are registered to sell securities.
In addition,on Tuesday, Commissioner Iles entered separate emergency cease and desist orders against DGBK Ltd., an offshore digital “bank” that claims it has developed hack-proof storage for virtual currencies; and Ultimate Assets LLC, a supposed cryptocurrency and foreign exchange trader.
US authorities have been tightening their grip on cryptocurrency-related fraud. In August this year, the North American Securities Administrators Association (NASAA) has provided an update on the progress of the efforts of state and provincial securities regulators in the United States and Canada to put an end to cryptocurrency fraud.
Back then, NASAA said that over 200 active investigations of Initial Coin Offerings (ICOs) and cryptocurrency-related investment products are currently underway by regulators in the United States and Canada as part of “Operation Cryptosweep.” Since its launch in May, this campaign has led to 47 enforcement actions involving ICOs or cryptocurrency-related investment products. In late May, the number of such actions was 35.