Texas Securities Commissioner Travis J. Iles entered an emergency action Nov. 27 to stop an investment offering by a cryptocurrency promoter who previously sold a digital currency that lost 99% of its value.
The Emergency Cease and Desist Order alleges that Mark Steven Royer of Del Mar, Calif., is fraudulently offering investments in a cryptocurrency trading and mining program operated by My Crypto Mine. Royer, a principal of the company, is targeting investors in Texas and elsewhere using social media and standalone websites.
According to the order, Royer is not disclosing key information about the risks of the cryptocurrency trading and mining that My Crypto Mine is supposedly undertaking. Nor is he informing investors about his experience at BitQyck Inc., a company that sold a digital currency called bitqy.
Royer was an alleged affiliate of BitQyck, a Dallas company controlled by Bruce Bise and Samuel J. Mendez. In 1997, Bise was sentenced to seven years in state prison in Arizona after his conviction on check forgery charges. Mendez was disbarred as a California attorney in 1996 after misappropriating client funds.
Royer was allegedly selling bitqy as early as May 2017, when its price was $0.02, according to the order. He told potential investors the price of bitqy would rise to $3.00, but as of Nov. 11, 2018, bitqy had lost more than 99% of its value.
Instead, Royer is touting his 30-plus years in the information technology sector and his 10 years of involvement in cryptocurrencies.
According to the order, Royer is promising investors that they can earn guaranteed, no-risk returns of between 10% and 20% per week. In an effort to boost investor confidence, My Crypto Mine is claiming its trading is audited twice yearly.
Royer, however, is allegedly providing investors with no information about My Crypto Mine’s trading strategy or the background of its personnel.
Royer’s marketing is targeted to a wide range of potential investors. He claims the profits from My Crypto Mine investments have helped small investors save for retirement; allowed parents and grandparents to build up six-figure college funds; and wiped out credit card and tax debts.
Royer also allegedly claims My Crypto Mine has been selected by a “major national Church” to be its “recommended Crypto/Passive Investment” for its 6 million members.
According to the order, Royer is recruiting sales agents to sell My Crypto Mine investments without verifying they are registered to sell securities in Texas, as state law requires.
Royer is allegedly offering an ascending scale of commissions to individuals who recruit new investors. He is promising to pay a commission of 2% of a new principal investment of between $10,000 and $50,000, 3% of an investment between $50,000 and $100,000, and 4% if the investment is more than $100,000.
The company and Royer have 31 days to contest the order at the State Office of Administrative Hearings.