Texas' financial watchdog have obtained a court order to suspend the company, which is accused of illegal promotion of bitcoin investment products in the state, reports CoinDesk.
According to the report, the Securities Board of the State of Texas revealed that the USI-Tech Limited, based in Dubai, sells investment contracts on the territory of "dozens of Texas cities" through social networks, websites and advertising on various sites, including Craigslist. Also two representatives of the company in the US are named: Clifford Thomas from Maryland and Michael Rivera from California.
Judging by the presentation, USI specializes in the sale of software and equipment for mining and trading. The document also provides the stated statistics of how many potential investors will be able to earn on commissions depending on the number of "referrals".
According to the Texas regulator, the company promises a stable daily profit, reminiscent of high-yield investment plans. Also, the firm encourages potential investors to agitate to invest other people's money in order to profit from it.
The agents' websites claim the mining investment 'derives its value from [USI-Tech's] non-exclusive interest in a series of bitcoin mining contracts.' They promise a daily return of 1%. The USI-Tech website says its bitcoin platform “consistently provides returns of up to 150% per year." The returns do not depend on the value of bitcoin, according to the company. In addition to violating registration requirements, USI-Tech and the sales agents are violating State Securities Board rules by failing to disclose information investors would need to make an informed decision about whether to invest.
The persons indicated in the court order are accused of violating the standards for registering securities of the state of Texas and failing to provide proper information about the risks associated with the mining of bitcoin.