SEC suspends trading in ARGB securities over false cryptocurrency-related claims

Maria Nikolova

Two press releases by ARGB aka Simex claimed that the company had partnered with an SEC qualified custodian for use with cryptocurrency transactions that would be “under SEC Regulations”.

The United States Securities and Exchange Commission (SEC) has earlier today announced that it is suspending trading in the securities of American Retail Group, Inc. (ARGB), also known as Simex Inc, over making of false cryptocurrency-related claims.

In its announcement on the matter, the SEC explains the temporary suspension is imposed pursuant to Section 12(k) of the Securities Exchange Act of 1934. It commences at 9:30 a.m. EDT on October 22, 2018 and terminates at 11:59 p.m. EDT on November 2, 2018.

The regulator temporarily suspended trading in the securities of ARGB due to concerns about the accuracy and adequacy of information in the marketplace about, among other things, the company’s products and services and certain regulatory approvals, as stated in press releases issued on August 16, 2018 and August 22, 2018.

The SEC’s trading suspension order says that two August 2018 press releases issued by Nevada-based American Retail Group, Inc. (OTC:ARGB) aka Simex, Inc. claimed that the company had partnered with an SEC qualified custodian for use with cryptocurrency transactions that would be “under SEC Regulations,” and that the company was conducting a token offering that was “officially registered in accordance [with] SEC requirements.”

“The SEC does not endorse or qualify custodians for cryptocurrency, and investors should use vigilance when considering an investment in an initial coin offering,” said Robert A. Cohen, Chief of the SEC Enforcement Division’s Cyber Unit.

Under the federal securities laws, the SEC can suspend trading in a stock for 10 days and generally prohibit a broker-dealer from soliciting investors to buy or sell the stock again until certain reporting requirements are met.

This is not the first time that the US regulator halts trading in securities of companies involved in cryptocurrency-related activities. In April this year, for instance, announced a temporary suspension of trading in the securities of IBITX Software Inc. (IBXS), a New York corporation.

The Commission attributed its decision to “questions regarding the accuracy of assertions by IBXS, a New York corporation whose principal place of business is listed as the Philippines, in press releases to investors and disclosure statements concerning, among other things, the company’s development of alternative forms of currency, and the company’s operation of a cryptocurrency platform”.

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