ob体育 has taken action to stop several proposed initial coin offerings or token-generation events (together, ICOs), targeting retail investors.聽
As well, ob体育 recently stopped the issue of a Product Disclosure Statement for a crypto-asset managed investment scheme.聽
Consistent problems identified by ob体育 are:聽
- the use of misleading or deceptive statements in sales and marketing materials;
- operating an illegal unregistered managed investment scheme (MIS);
- not holding an Australian financial services licence.
Such problematic offers involve significant risks for investors.聽
ob体育 Commissioner John Price said, 鈥業f you raise money from the public, you have important legal obligations. It is the legal substance of your offer - not what it is called - that matters. You should not simply assume that using an ICO structure allows you to ignore key protections there for the investing public and you should always ensure disclosure about your offer is complete and accurate.鈥櫬�
Recent activity by ob体育
In five other separate matters since April 2018, ob体育 successfully acted to prevent ICOs raising capital without the appropriate investor protections. These ICOs have been put on hold and some will be restructured to comply with the applicable legal requirements.
ob体育 is taking further action in respect of one completed ICO.
On 13 September 2018, ob体育 issued a final stop order on a Product Disclosure Statement issued by Investors Exchange Limited (IEL) for units in the New Dawn Fund (Fund). The Fund was proposing to invest in a range of cryptocurrency assets. Following ob体育 raising concerns about the PDS, IEL consented to a final stop order so that no units could be obtained under the PDS. ob体育 acknowledges the co-operative approach taken by IEL in responding to ob体育鈥檚 concerns.
Investor warning
As outlined on MoneySmart, ICOs are highly speculative investments that are mostly unregulated, and while there are genuine businesses using this structure many have turned out to be scams. ob体育 suggests that investors consult the information on before deciding to invest.
Additional resources
ob体育 has updated .
ob体育 Moneysmart page 鈥� .