The U.S. Securities and Exchange Commission has obtained an emergency order halting a fraudulent initial coin offering but only after those behind it had already managed to raise $21 million.

Called “Titanium Blockchain Infrastructure Services” (TBIS or Titanium for short), the ICO was selling tokens to develop a “shock-proof, decentralized blockchain” platform in what has to come close to hitting a record for the must buzzwords ever strung together in a sales pitch. In its own words:

Titanium will usher in a new era of network construction. With TBIS’ proprietary Company as a Service™ (CaaS) and Infrastructure as a Service (IaaS), every device, from enterprise level on down, can be virtualized; routers, firewalls, and specialized equipment such as cryptocurrency miners, can exist in an entirely cloud-based environment based on the decentralized Ethereum blockchain. Paired with cutting-edge enterprise management and monitoring technology, this will create a shock-proof internet infrastructure that will be both lightweight and completely revolutionary in scope.

If that description wasn’t a wakeup call for potential investors, the SEC filing claimed that Titanium President Michael Alan Stollery, also known as Michael Stollaire, lied about business relationships with the Federal Reserve and dozens of well-known firms including PayPal Inc., Verizon Communications Inc., Boeing Co. and the Walt Disney Co. The company is also alleged to have fabricated testimonials from corporate customers and that Stollaire promoted the ICO through videos and social media, comparing it to investing in “Intel or Google.” 

“This ICO was based on a social media marketing blitz that allegedly deceived investors with purely fictional claims of business prospects,” Robert A. Cohen, chief of the SEC Enforcement Division’s Cyber Unit, said in a statement.

The court order includes an immediate halt on trading, an emergency asset freeze and the appointment of a receiver for Titanium.

The action comes two weeks after the SEC launched a fake ICO offering website in an attempt to educate investors about the risks involved. It also follows actions against previous fraudulent ICOs, including Centra Tech and AriseBank.

A report in February suggested that the SEC had issued dozens of subpoenas and information requests to technology companies and advisers involved in the ICO market as part of an ongoing investigation into the legality of the offerings.

Image: Titanium