The North American Securities Administrators Association (NASAA) held a public policy roundtable this week in Washington, DC. One of the big topics of the gathering was “What the Rise of Cryptocurrency Means for Investor Protection.” NASAA is the group that represents state and provincial regulators. These regulators possess a wide ranging authority to pursue acts of financial fraud and address state compliance issues.
While CI was unable to attend the event, a series of tweets are indicative of an interesting discussion on cryptocurrency. NASAA has been at the forefront of pursuing allegations of fraud in the initial coin offering space (ICO) and the lobbying group has set up an entire section of their website outlining enforcement actions and warnings to consumers.
Securities and Exchange Commission (SEC) “Crypto Chief” Robert Cohen is on the record stating;
“…not all companies using cryptocurrency/blockchain technology are fraudulent. I know there are real companies engaged in legitimate activity in this area. It’s hard for them to compete against those who don’t follow the rules … When it comes to cryptocurrencies and ICOs, we’re very concerned about fraudulent activity in this area. … There’s a lot of fraud going on.”
Texas Securities Commissioner Travis Iles demanded coordination between reguators in the “crypto fraud fight.”
“This is an area that we’re going to dedicate significant enforcement assets for the near future. We really need to coordinate among regulators to leverage our resources,” stated Iles.
Iles added that, at least in Texas, they are just enforcing existing laws;
“We’re not trying to regulate technology. We’re here to enforce securities laws.”
State financial regulators have a love-hate relationship with federal regulators. Frequently, oversight and compliance overlap creating a byzantine and duplicative structure for legitimate financial services – including security ICOs.
NASAA President Mike Pieciak (second from left) leads a panel on cryptocurrency’s impact on Main Street. Joining him are (from left) Robert Cohen, chief of the SEC’s Cyber Unit; Texas State Securities Commissioner Travis Iles; and Washington Post technology reporter Brian Fung. pic.twitter.com/DibuyHAcNq
— NASAA_News (@NASAA_News) May 7, 2018