US SEC Launches Mock ICO ‘HoweyCoin’ To Educate Investors About Fraud | News ICORating
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US SEC Launches Mock ICO HoweyCoin To Educate Investors About Fraud

US SEC Launches Mock ICO HoweyCoin To Educate Investors About Fraud

The US Securities and Exchange Commission (SEC) has launched a website dedicated to a fictitious initial coin offering (ICO) project, dubbed “HoweyCoin”, in order to educate potential investors on how to avoid ICO fraud.

According to a May 16 press release, the SEC’s Office of Investor Education and Advocacy launched the HoweyCoin project to “mimic a bogus coin offering to educate investors about what to look for before they invest in a scam.”

SEC Chairman Jay Clayton said that the regulator wants “investors to see what fraud looks like,” which is why the SEC commissioned the HoweyCoin educational project. The HoweyCoin site was built “with many of the classic warning signs of fraud” in order to encourage promoters and issuers “to make sure they follow securities law.”

The website uses “several of the enticements common to fraudulent offerings,” including “a white paper with a complex yet vague explanation of the investment opportunity,” “promises of guaranteed returns,” and “a countdown clock that shows time is quickly running out on the deal of a lifetime.

However, any potential investors that considering buying into the HoweyCoin project were quickly disappointed after clicking on the “Buy Coins Now!” button, which instead sends users to a page about “investor education tools and tips from the SEC and other financial regulators.”

The press release noted that the SEC was able to build the HoweyCoins website “in-house in very little time,” which shows “just how easy it is for someone to create a scam opportunity.”

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