Insider.pro continues the quest to reveal all about the most high-pitched scam projects of the ICO sphere. Today we will dip into the story of AriseBank, the first "crypto bank", which turned out different from what it first seemed.
The story of AriseBank began in late 2017. The founders of the Bank Jared Rice and Stanley Ford launched ICO procedure to raise $ 1 billion for their "innovative" idea - the world's first cryptocurrency bank with a full range of services.
As Jared declared, "We were pleased to be at the forefront of history. We feel that sooner or later such banks will appear, we would like to become the founders of the process in the industry as a whole. The bank, which will provide services to our clients, has hundreds of partners around the world."
The most convincing argument was that AriseBank claimed that it had reached an agreement with the U.S. Federal Deposit Insurance Corporation (FDIC) to acquire two banks - KFMC Bank Holding Company and TPMG. In addition, the bank had to cooperate with the Bitshares company, a large corporation specializing in developments in the field of blockchain.
The project also claimed that is had all the necessary certificates, licenses for the activities. So, it wasn’t surprising that AriseBank managed to collect about $600 million during an ICO. But like all Hollywood movies, the storyline couldn’t be eternally happy and the payoff caught up with its heroes.
In January 2018 according to a press release issued by the Texas Department of Banking, it had ordered to terminate all operation of AriseBank platform.
The commissioner of the Department of Banking said that the company promoted and offered banking services without the right to conduct banking activities on the territory of the state and was "not controlled and registered in the Texas in the federal regulatory agency."
According to the initial order, which was published on January 5, AriseBank had 21 days to appeal the decision. The bank didn’t take any action and the authority ruled that the order was final and not subject to appeal.
Towards the end of January the U.S. Securities and Exchange Commission (SEC) accused the cryptobank of fraud.
The court amassed a case against the company on the complaint of SEC, which accused the project of using social networks and celebrities for promotion like Evander Holyfield, the former boxing champion.
The regulator said that AriseBank deceived its investors by offering them “approved by FDIC” products and Visa cards that could process cryptocurrencies. The court decided to block the assets of AriseBank founders, even their cryptocurrency accounts.
In March SEC updated the case information, saying that it added accusations that the defendants didn’t disclose information about Rice's criminal past and that they made false statements about the experience of AriseBank president. Jared Rice was also accused of theft and forgery of government documents in Texas in November 2015.
It turned out that AriseBank founders were rather shady characters.
Rice’s biography presented him as a serial entrepreneur who launched a dozen of internet companies, starting from a child-focused search engine that filtered out inappropriate content, ending with a company that developed mobile apps for law firms. He also claimed that in 2012 he received a patent for a technology called "IPSaaS" but its сonfirmation couldn’t be found.
Moreover Jared Rice published a book about his life journey, where he told all about the peculiar details of his life.
Presently, Jared Rice is under detention.
Stanley Ford, the Chief Operating Officer of AriseBank, is much clever then his colleague and led a more conceal life. It is only known that he is oil and gas seller and lives in Dubai. Of course, he has never appeared at any hearing of the case.
The history of AriseBank shows once again that some scam projects can be so convincing that they are not afraid even to refer to the regulators which in turn failed to react to the situation in time. Be vigilant and check carefully what you invest into. AriseBank is an excellent example.
