SEC wants to dig deeper into US-related activities of cryptocurrency firm PlexCorps
The SEC wants detailed information from PlexCorps’ founders and managers about their trips to the US and their communications with US residents.
The United States Securities and Exchange Commission (SEC) has once again demonstrated its determination to prosecute cryptocurrency fraud. On Wednesday, April 25, 2018, the Commission filed a set of Interrogatories with the New York Eastern District Court requests that the defendants in a virtual currency fraud case targeting PlexCorps (also known as PlexCoin) and Dominic Lacroix, Sabrina Paradis-Royer, and Sidepay, respond to these interrogatories on or before April 30, 2018.
- In particular, the Interrogatories concern electronic mail addresses used by the defendants (or by anyone acting on their behalf) in connection with PlexCoin. For each E-Mail Address, they have to state details such as the name(s) of the individuals with access to the E-Mail Address and the date(s) each had access.
- The Interrogatories also concern all social media accounts, including for, but not limited to, Facebook, LinkedIn, Twitter, Instagram, Flickr, and Google, used by the defendants (or by anyone acting on your behalf) in connection with PlexCoin. For each Social Media Account, they have to state details such as the name(s) of the individuals with access to the account and whether they still have access to the account.
- The defendants will also be requested to list all electronic databases created or accessed containing PlexCoin investor information.
There are some disagreements between the defendants and the SEC about the US activities of the alleged fraudsters. Thus, for instance, the defendants allege they travelled to the United States just for pleasure, whereas the SEC does not believe that no business was conducted during the trips in question. Also, the defendants allege that they had investor bases solely with Shopify. The evidence uncovered by the US regulator, however, shows that there were client bases with other vendors like Square.
The interrogatories concerning emails stem from certain claims by the defendants. For instance, one of them – Ms. Paradis-Royer, is said to have never sent an email to a person in the United States.
The case against PlexCorps has demonstrated the persistence of SEC when prosecuting cryptocurrency scammers. Earlier this month, the US regulator obtained a Court order that asks the Quebec Superior Court for judicial assistance with regard to one of PlexCorps’ employees. Yan Ouellet, has assisted the firm in, inter alia, setting up and/or running PlexCorps’ and PlexCoin’s websites. The order demonstrated that even marketing assistants and “IT guys” at cryptocurrency firms are not shielded from SEC’s enforcement actions, when it comes to fraud.
The US regulator alleges that it has to stop Lacroix, a recidivist securities law violator in Canada, and his partner Paradis-Royer from further misappropriation of investor funds illegally raised through the fraudulent and unregistered offer and sale of securities called “PlexCoin” or “PlexCoin Tokens” in a purported “Initial Coin Offering”.
