The Securities and Exchange Commission of Pakistan (SECP) has just announced legal action against nine companies who deal with cryptocurrencies.
Nine companies involved in cryptocurrencies have been found by the Securities and Exchange Commission of Pakistan (SECP) to be engaging in unlawful activities.
The SECP has instructed the public not to be misled by the following companies which have just been charged:
- Gold Transmit Network Technology (Pvt.) Limited
- Green Apple Super Market (Pvt.) Limited
- Galaxy Typing Jobs (SMC-Pvt.) Limited
- 3-A Alliance (Private) Limited
- Pak Memon Impex (Private) Limited
- Memon Corporation (Pvt.) Limited
- Humanitas Meritus (SMC-Private) Limited
- IDG Enterprises (Private) Limited
- Ayat Enterprises (Smc-Private) Limited
The SECP has said that these nine companies were found to be committing illegal business activity including allowing unauthorized deposits and leasing of cars, houses, and other goods and materials without a license. Most of them offer Ponzi schemes having to do with multi-level marketing (MLM). These companies were engaging in classic pyramid schemes but enticing customers with cryptocurrencies through the form of guaranteed returns and ‘get-rich-quick’ schemes.
Not only were these companies not registered with the SECP, but they were actively misleading their customers. Luckily, these fraudulent businesses will now be prosecuted, likely sued, and forced to end their operations.
In April of 2018, the State Bank of Pakistan officially banned Bitcoin (BTC) and other virtual currencies. This news came shortly after India made a similar move earlier that year.
However, the SECP is not well-known for taking such drastic legal actions against cryptocurrency-related businesses in the past. Although the country continues to officially affirm the illegality of cryptocurrencies, the law was largely unenforced. This is among the first instances the SECP has taken decisive legal proceedings against a company dealing with cryptocurrencies.
Will this crackdown establish a new cryptocurrency policy in Pakistan? Let us know your thoughts below.
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