Jared Rice, the CEO of AriseBank, has hit back at regulators who last week blocked his $600m initial coin offering (ICO).
The Securities and Exchange Commission in Texas has accused AriseBank of using celebrity endorsers and social media to swindle hundreds of investors out of at least $600m of its $1bn intended target.
The SEC considered the ICO of AriseCoin - to be an illegal offering of a security. In a statement the SEC said it would use all its “tools and remedies to protect investors from those who engage in fraudulent conduct in the emerging digital securities marketplace."
According to the SEC, two other banks which Arise claimed to have acquired stakes in, do not exist.
‘Changing the world’
In response to the SEC, Rice released a statement on messaging app Telegram. “Many people’s dreams fail over time, it’s simply a circumstance that surrounds us when we’re trying to do something that can and will change the world.”
He added: “AriseBank was and still is a project that I gave my entire life to," Rice added. "I’m not hiding. I’m proud of what we’ve built and regardless of what happens, I can sleep at night knowing that I did my best, I gave it my all and I did it with all the right intentions."
Rice continues to depict AriseBank and its ICO, AriseCoin as a way to disrupt traditional banking and avoid governmental monetary controls.
"For us as people, the day has come for us to speak on the disruption of blockchain, why the government wants to attack it and why we the people deserve a fair shake at regulating it, for us - not them,” Rice said. “We have to build upon this - we have to fight.”
Despite the rallying cry from Rice, the evidence continues to pile up against him, with a court date set for February 8 in the US District Court for the Northern District of Texas.
A former AriseBank executive, speaking (under anonymity) to news site Business Insider, revealed there was "zero paperwork" for the firm, and that Rice was using the LLC registration of his other company, marketing firm Dotoji, to do business.
"Arise, as far as I can tell, doesn't have any actual working products," the employee said.
In addition to the fraudulent claims relating to AriseCon, the SEC lawsuit also alleges the company failed to mention the criminal backgrounds of its founder. Rice is believed to be on probation for theft and tampering with government records.