Law Enforcement

SEC cyber squad halts cryptocurrency offering

Cyberattack, financial services 

The new Cyber Unit at the Securities and Exchange Commission stopped an ongoing cryptocurrency offering that has attracted up to $15 million in investment since launching in August.

The SEC's action against PlexCoin, marketed as a faster rival to Bitcoin, is the first from the Cyber Unit, which was created in September  2017 to focus investigators with experience in online fraud and other cyber scams on pursuing cases in blockchain-based cases including initial coin offerings for novel cryptocurrency products. Additionally, the Cyber Unit is addressing attempts to publicize such scams on social and electronic media using false information.

"This first Cyber Unit case hits all of the characteristics of a full-fledged cyber scam and is exactly the kind of misconduct the unit will be pursuing," Cyber Unit Chief Robert Cohen said in a statement. "We acted quickly to protect retail investors from this initial coin offering's false promises."

The defendants in the case allegedly promised returns of between 200 percent and 1,354 percent within 29 days, depending on the point at which a purchaser bought into the PlexCoin initial offering, according to the SEC complaint released Dec. 4.

The SEC is charging Canadian national Dominic Lacroix and his partner Sabrina Paradis-Royer in the scheme. According to the SEC, so far $810,000 of the approximately $15 million paid by investors in the offering has found its way to accounts that were set to come under the control of Lacroix and his associate. Thus far, the SEC alleges, the defendants "have misappropriated or attempted to misappropriate at least $200,000 of these amounts on extravagant personal expenditures."

According to the complaint, Lacroix and his associate flouted efforts by Canadian authorities to close down the initial coin offering.

About the Author

Adam Mazmanian is executive editor of FCW.

Before joining the editing team, Mazmanian was an FCW staff writer covering Congress, government-wide technology policy and the Department of Veterans Affairs. Prior to joining FCW, Mazmanian was technology correspondent for National Journal and served in a variety of editorial roles at B2B news service SmartBrief. Mazmanian has contributed reviews and articles to the Washington Post, the Washington City Paper, Newsday, New York Press, Architect Magazine and other publications.

Click here for previous articles by Mazmanian. Connect with him on Twitter at @thisismaz.


  • Contracting
    8 prototypes of the border walls as tweeted by CBP San Diego

    DHS contractors face protests – on the streets

    Tech companies are facing protests internally from workers and externally from activists about doing for government amid controversial policies like "zero tolerance" for illegal immigration.

  • Workforce
    By Mark Van Scyoc Royalty-free stock photo ID: 285175268

    At OPM, Weichert pushes direct hire, pay agent changes

    Margaret Weichert, now acting director of the Office of Personnel Management, is clearing agencies to make direct hires in IT, cyber and other tech fields and is changing pay for specialized occupations.

  • Cloud
    Shutterstock ID ID: 222190471 By wk1003mike

    IBM protests JEDI cloud deal

    As the deadline to submit bids on the Pentagon's $10 billion, 10-year warfighter cloud deal draws near, IBM announced a legal protest.

Stay Connected

FCW Update

Sign up for our newsletter.

I agree to this site's Privacy Policy.