Alabama: The Unlikely Frontline for America’s Crypto Fraud Crackdown

“Of the states, I think we’ve got about 20 percent of all the active cease-and-desists.”

That’s Greg Bordenkircher, the chief litigator at the Alabama Securities Commission, describing the extent to which his state, just the 24th largest by population, has nonetheless come to play a leading role in the ongoing fight against U.S. crypto fraud.

“We’ve issued nine orders shutting down businesses that are advertising in Alabama,” he told CoinDesk. “We have another 20, 22 that we are looking at right now.”

But Bordenkircher’s agency is hardly alone. As a member of the North American Securities Administrators Association (NASAA), it’s part of a coalition that’s been conducting a continent-wide sweep of initial coin offerings in an effort to sniff out illicit activities. To date, regulators in South Carolina, Colorado and Texas have taken on suspect ICOs as well, and Canadian prosecutors have also played an important role in the sweep.

NASAA’s website lists a number of actions taken by the State of Massachusetts, too.

The sweep started with a list of 300 or so projects, but the latest numbers have those being investigated down to 200 (some have been determined not to be fraudulent).

While much of the attention in crypto has been on the U.S. Securities and Exchange Commission (SEC), state action is an important facet of chasing bad actors out of the market, he argued.

Bordenkircher told CoinDesk:

“The SEC does a great job and CFTC does a great job, but the states have really got the boots on the ground. There’s more of us than there are of them.”

Still, federal and state-level agencies are coordinating, sharing information and breaking up the work.

“It’s almost a task force view of all of us coordinating together,” he said. ..Read More..

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