Ahead of the New York trip, I thought I'd see what the state's regulators have been up to. This one stood out.
This year, the New York Attorney General secured over $5 million for customers who lost money on a crypto savings product called CredEarn. That's more than five times the fees the platform promoting it, Uphold, collected.
What Went Wrong
It was promoted as a 'savings product' paying up to 10%. Customers were also told the company behind it had "comprehensive insurance". The AG found no insurance covering retail investors' digital asset losses. The company went bankrupt in November 2020.
Words Carry Weight
Words like "savings" and "insurance" carry real weight in financial products. A customer reads them as a promise about their money, and they act on it. Even the comparison, "some of the most", is a claim that needs evidence behind it.
So every claim needs evidence you can point to, and if you're promoting someone else's product, their claims become yours.
Neil Dillon, CEO & Founder, Solas Compliance