Tuesday, September 27, 2022

SEC To Bolster Its Anti- Crypto Scam Department With 20 New Staff

The U.S. Securities and Exchange Commission (SEC) is set to recruit 20 extra staff as part of its endless efforts to protect crypto investors from scams and cyber threats that continues to threaten the industry.

SEC Keen On Investor Protection

Meanwhile, SEC’s decision to better equip its enforcement unit may be understandable. This is because, criminals and illicit actors are constantly targeting digital assets. However, with the new addition, a total of 50 staff will now be overseeing lending, coin offerings, non-fungible tokens, as well as decentralized finance.

It might also be noteworthy that the SEC had issued several warnings against crypto-related scams and many other “get rich quick” schemes in the past. In fact, to this effect, the agency issued a statement last September that reads in part:

“Fraudsters continue to exploit the rising popularity of digital assets to lure investors into scams, often leading to devastating losses. If you are considering a digital asset-related investment, take the time to understand how the investment works and to evaluate its risks. Look for warning signs that it may be a scam.”

Interestingly though, SEC’s enforcement unit has taken well over 80 enforcement actions on its own since 2017. And the actions as it were, were directly against unregistered and fraudulent offerings.

Recently, the SEC also blacklisted a number of companies which it thought were misleading investors. The agency says the companies are not plain enough about their dealings, and warned investors against doing business with them.

Eyes On DeFi And NFTs

Meanwhile, SEC may be set to extend its prying eyes to decentralized finance as suggested in some recent proposals by the agency. Additionally, there are also reports that the commission is presently considering whether or not, NFTs should fall under its regulatory umbrella.

But whatever might be the case, the SEC will certainly be keeping an eye on any firms, that want to offer securities for sale. In fact, the agency’s oversight will also extend to trade advisors and brokers as well.

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