Although most initial coin offerings are reason for excitement as an investor, there is always the risk of getting scammed. One individual is facing fraud charges stemming from two ICOs he organized earlier this year. However, this doesn’t appear to be a clear-cut case, as Maksim Zaslavskiy has pleaded not guilty to both counts. Although he was the mastermind behind both ICOs, he claims there was never any intention to defraud investors.
Maksim Zaslavskiy Pleads Not Guilty
In a way, it is not entirely surprising that Zaslavskiy claims he didn’t defraud ICO investors. Two of his projects were flagged by the SEC in regards to securities fraud. Neither project had any basis in reality, and investors were apparently blatantly lied to when they made financial contributions. It didn’t take long for the SEC to crack down on both projects and arrest the person responsible for defrauding investors.
The big question is whether or not Zaslavskiy is the main culprit pulling the strings, though. With his pleading not guilty to both charges, it is evident there may be a lot more to this story than originally assumed. Moreover, he successfully secured a US$250,000 bail with a property in Brooklyn as collateral. This seems to confirm this man has no dishonest intentions, although both of his projects still raise far more questions than answers right now.
One of Zaslavskiy’s ICOs was supposedly tied to real estate. So far, no link has been found between any actual properties and the project as it was described to investors. The second ICO was allegedly linked to the diamond industry, although very little evidence has surfaced to back up that claim. It is true that diamonds and real estate are two very popular industries, but not everyone in the world has access to the resources they claim to.
The SEC is concerned about both projects, as it is highly unlikely investors will ever see a return on their investment. Zaslavskiy and his associates enticed investors by promising significant returns after they invested in these ICOs. However, with no real estate or diamonds backing either of these investments, it was evident the fraudulent nature of these ICOs would come to light sooner or later.
For the time being, all assets tied to these two ICO projects and Zaslavskiy himself are still frozen. The SEC successfully obtained a court order to freeze these assets, and the restriction has not been lifted since. Until this investigation is concluded, there is no reason to do so either. It is possible Zaslavskiy is working toward reaching a plea deal with the US government, although that has not been officially confirmed by either party.
It will be interesting to see how this particular court case plays out in the coming months. If Zaslavskiy is found guilty, there will be a price to pay. If this matter can be settled through a plea agreement, all the better for all parties involved. The lingering question is whether or not the ICO investors will get their money back, either partially or in full. The initial coin offering industry is fraught with pitfalls, and not every project has honest intentions.