A few days after it lost almost all of its value, the Securities and Exchange Commission (SEC) warned people “not to invest or stop investing” in Lodicoin.
SEC records show that Lodi Technologies Incorporated, which does business as LODITECH, has been a registered corporation since August 2, 2021.
But that company is running without the license or permission it needs to ask for, accept, or make investments or placements from the public or to sell investment contracts and other types of securities as defined in Section 3 of the Securities Regulation Code (SRC).
LodiTech has been seen on Facebook, Twitter, Instagram, and Discord, among other social media sites, by the Commission. By using these platforms, people have been encouraged to invest in Lodicoins (LODI) through their website, lodicoins.com. The startup also uses the said virtual currency.
On its website, the company said that LODI is a utility token.
But as the Commission did its research, it found out that the Chief Executive Officer and Co-Founder of LodiTech had talked up the virtual asset on social media and promised investors a significant return on their money if they bought it.
“Lodicoin would be listed at ten times the pre-sale or original private price, making it appear that those who purchase the coin in the ICO will earn at least 1000% in profits.” — SEC.
Several Facebook posts acquired by the Commission demonstrated that the company entices investors with 54% commission deals. Rank Bonus packages offer cash bonuses, a car, a luxury watch, and travel incentives.
The SEC also found that the startup’s registration was invalid because it said its primary goal was to be a business processing outsourcing (BPO) service provider, which doesn’t match its actual business model.