Missouri Secretary of State Jason Kander has shut down a Springfield Bitcoin-related investment program, citing the fact that Kenneth Slaughter employed “deceptive tactics” in order to persuade investors to fund the Bitcoin mining equipment.
Kander said in a press release that Slaughter convinced investors to buy shares in Virtual Mining Corporation, of which he was the Chief Executive Officer, in exchange for returns of as much as 2,812 within two years.
Mining involves finding solutions to complicated mathematical problems in order to form new bitcoins.
“The fact that somebody is selling investments through Bitcoin rather than traditional currency doesn’t change their obligations to investors, and I encourage Missourians to call my office before making any Bitcoin investments,” said Kander. “Investors have a right to know the full set of facts about both an investment and its backer, including the risks, profit-generating strategy and pertinent financial history.”
Kander also said that Slaughter solicited new investors via an online forum called “Bitcointalk”, with his efforts raising $200,000 worth of Bitcoins. Slaughter also promised investors 100 percent return from the sales of the mining technology and claimed that the company had representative offices in London.
Kander added that Slaughter failed to tell investors about the potential risks that the venture may pose, such as fluctuation in Bitcoin prices. Rather, Slaughter misinformed investors by lying to them that the digital currency is “highly regulated” both at state and federal level. Normally, Bitcoins are not controlled by any government or any central bank, with most federal agencies still mulling over how to treat Bitcoin.
Kander said he expects Slaughter and the associated companies, including Active Mining Corporation, to be prosecuted for the crimes.
“I encourage Missourians to call my office at 1-800-721-7996 to check on the registration status of the person and product they are considering investing with,” added Kander. “If somebody isn’t registered, that’s a major red flag.” To register for a free 2-week subscription to ForexMinute Premium Plan, visit www.forexminute.com/newsletter.
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