New York State Legislators Introduce Bills Aimed at Criminalizing Crypto Fraud and Rug Pulls 11

New York State Legislators Introduce Bills Aimed at Criminalizing Crypto Fraud and Rug Pulls

Summary:

  • The US State of New York, through its legislators, has introduced bills aimed at criminalizing crypto fraud and rug pulls
  • The first one, bill S8839, is in the New York Senate and establishes certain offenses relating to crypto fraud, illegal rug pulls, private key fraud, and fraudulent failure to disclose an interest in virtual tokens
  • The second one, bill A8820, is in the New York Assembly with a similar motive as S8839

Legislators in the US State of New York have introduced two bills aimed at criminalizing crypto fraud and rug pulls.

Senate Bill S8839

The first one, bill S8839, is in the New York State Senate and was introduced by State Senator Kevin Thomas of the 6th State District. The bill aims to establish ‘the offenses of virtual token fraud, illegal rug pulls, private key fraud and fraudulent failure to disclose interest in virtual tokens.’ To achieve this objective, the bill will attempt to amend the penal law in relation to establishing certain offenses relating to crypto fraud.

The bill further has the following justification:

Rug pulls are now wreaking havoc on the cryptocurrency industry…This bill will provide prosecutors with a clear legal framework in which to pursue these types of criminals. Private key fraud is, in many ways, analogous to stealing someone else’s debit card pin.

When individuals invest in virtual tokens, it is critical that they have as much information as possible in order to make an informed investment decision…Buyers have the right to know the degree of control over the virtual tokens price that the developers have and the degree of consolidation of the tokens in the developers.

Bill s8839 is currently in the committee phase and has to be debated on the floor. It also has to be passed by the Senate and Assembly through voting. Once successful, it will be delivered to the Governor of New York who will decide whether to sign it into law or veto it.

Assembly Bill A8820

The second bill is A8820 which is currently in the New York State Assembly. The bill was introduced by Member of the NY State Assembly, Clyde Vanel, and is a companion bill to S8839 currently at the Senate. It has a similar goal of amending the penal law to establish the offenses of virtual toke fraud, illegal rug pulls, private key fraud and fraudulent failure to disclose interest in virtual tokens. The bill is also in the committee phase and will follow a similar path to S8839.