Texas orders crypto mining firm promising 200% profit to stop the operation

08 Nov, 2018
by Fifi Arisandi
News
Texas orders crypto mining firm promising 200% profit to stop the operation

Texas financial authorities issued a cease and desist order against a crypto mining firm that promises 200% profit to their prospect investors.

The Texas State Securities Board just issued a cease and desist order against a cryptocurrency mining firm owned by an Australian company, AWS Mining, Pty. Ltd.

The order also applies to several other entities related to the company, they are Automated Web Services Mining (AWS Mining), Mycoindeal, AWS Elite, and West Texas Oilfield Cloud Miners Club.

AWS Mining claimed to mine cryptocurrency through several crypto farms located in Guangzhou, Anhui, Hebei – China, Ingushetia – Russia, and Ciudad del Este – Paraguay.

To lure investors, the company claimed that each crypto mining contract “is guaranteed” of 200% return from purchase price.

However, the order stated that the company disclaims the profitability guarantee and describes that the investors are aware of the risks associated with the investment, despite the aforementioned “promotion strategy”.

The company uses a multi-level marketing system, which is run by Pennsylvania-based AWS Affiliate to recruit sales agents. According to News Bitcoin, the company uses social media platforms to post their sales agent job openings.

The board is convinced that AWS Mining and all its affiliates to have engaged in illegal, fraudulent, deceptive, and/or misleading practices in their business activities. While at the same time, violating the Securities Act as none of them have registered with the state’s Securities Commissioner.

Quoting the order, “The investments in the cryptocurrency mining program are ‘securities’ … Respondents are engaging in fraud in connection with the offer for sale of securities … [and] are making offers containing statements that are materially misleading or otherwise likely to deceive the public.”

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