Unregistered crypto brokerage hit with cease and desist in Missouri

Unregistered crypto brokerage hit with cease and desist in Missouri

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The Securities Division of the Missouri Secretary of State’s Office has issued a cease and desist order on Mavixbtc Limited on grounds of misleading investors.

Allegations have arisen that Mavixbtc is nothing more than a get-rich-quick scheme that is looking to profit off of the popularity of crypto assets. The company allegedly used the names of a number of registered investment advisors without their knowledge.

This deception allowed the company to steal thousands of clients from legitimate financial advisors, such as Benjamin F. Edwards & Co. This brought a number of complaints, forcing the Securities Commissioner to take action.

In a statement, the Commissioner, David M. Minnick, stated, “The novelty and promise of quick profits by investing in cryptocurrencies can be enticing to investors… But there are significant, real risks associated with these non-traditional investments, and scam artists are hard at work trying to defraud investors. Always check with our office before you invest.”

While the deception was of concern in and of itself, this was not the only issue that forced the state of Missouri to get involved. Mavixbtc was promising returns of 55%, claiming that they had attracted $1.89 million. The site still remained active despite the cease-and-desist order.

According to authorities, Mavixbtc went live on October 10, 2018, and has drawn over 51,000 accounts in that span. According to the firm, they were promising that earnings would come from cryptocurrency mining as well as from bot trading on exchanges. On their website, the company claimed that their bots would be able to generate huge payouts, none of which came to fruition.

These kinds of schemes are becoming commonplace. One such project, Bitcoiin2Gen, which is spearheaded by actor Steven Seagal, has been promising high returns with minimal investment.

Currently, no legal process has been initiated against Mavixbtc beyond the cease and desist order. They could face fines and restitution not to exceed $30,000. State regulators are still continuing their investigation and further details should become available as the investigation progresses.

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