The Securities and Exchange Commission issued an Emergency Cease and Desist order to halt an allegedly artificial intelligence-driven investment scheme.
Texas Securities Board Targets Alleged AI-Powered Crypto Scam
The Securities Commissioner Travis J. Iles issued a cease-and-desist order to halt the alleged AI-powered investment scheme endorsed by Musk. Horatiu Charlie Caragaceanu and his organizations, The Shark of Wall Street and Hedge4.ai were targeted by a group of authorities led by the Texas State Securities Board. The plan involves the marketing of TruthGPT Coin, a cryptocurrency that claims to use Elon Musk AI, an AI algorithm that is believed to analyze cryptocurrencies, predict future digital asset prices, and distinguish profitable investments from frauds.
The order informs investors that Elon Musk supports TruthGPT Coin, with animated avatars and photographs of Musk utilized to illustrate his support. According to the TruthGPT Coin website (truthgptc.com), the ecosystem includes Changpeng “CZ” Zhao, the creator and CEO of Binance, and Vitalik Buterin, the founder of Ethereum. According to the Texas lawsuit, Caragaceanu, The Shark of Wall Street, and Hedge4.ai engaged in a series of initial coin offerings (ICOs), advertising the success of the tokens via internet websites and social media. However, the tokens’ prices never increased significantly, and their fair market value is now $0, according to the orders.
TruthGPT Coin and the other investments mentioned in the order are not registered for sale in Texas, nor are Horatiu Charlie Caragaceanu, The Shark of Wall Street, or Hedge4.ai registered as dealers or agents. They have 30 days to file a hearing request. The crackdown on fraudulent AI scams underscores regulators’ commitment to protecting investors and ensuring compliance with securities rules.