WASHINGTON, Oct 22 (Xinhua) -- U.S. Securities and Exchange Commission (SEC) on Monday suspended trading in shares of American Retail Group, due to its false claims about SEC endorsements regarding cryptocurrency investments.
According to the SEC, the Nevada-based company had issued a false press release in August 2018, claiming that the company had partnered with an SEC qualified custodian for use with cryptocurrency transactions that would be "under SEC Regulations."
The company had made another false statement regarding cryptocurrency in August, claiming that the company had "officially registered in accordance with SEC requirements" during its token offering process, said the SEC.
According to 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.
Robert A. Cohen, Chief of the SEC Enforcement Division's Cyber Unit, said that the SEC does not endorse or qualify custodians for cryptocurrency.
"Investors should use vigilance when considering an investment in an initial coin offering," said Cohen.
The SEC issued an investor alert on October 11, warning investors to watch out for false claims about agency actions and endorsements related to digital assets. The SEC's Office of Investor Education and Advocacy had also issued an Investor Bulletin regarding initial coin offering (ICO) and a mock ICO website to educate investors.
