The Italian financial regulator CONSOB has suspended the promotion of LiraCoin Club in Italy for ninety days. This action, detailed in a May 29th bulletin, flags LiraCoin Club’s multi-level marketing scheme as an unregistered investment proposal.
Offering such a proposal is treated as a securities offering under Italian law, which mandates prior registration with CONSOB. LiraCoin Club and its parent company, Liracoin DAMO, failed to comply with these registration requirements. The suspension is a precautionary measure intended to protect investors.
LiraCoin Club has a sixty-day window to appeal CONSOB’s decision. Without a successful appeal, the suspension is expected to become permanent after the ninety-day period concludes.
ScamTelegraph reviewed LiraCoin Club on May 25th. The analysis concluded that the business model, which promises affiliates a return on investment in LIC tokens, mirrored classic Ponzi schemes like BitConnect. Shortly after this review was published, an individual named Tom Williams, claiming to represent LiraCoin Damo Organization, sent a cease and desist letter.
Williams alleged the review contained "serious, untrue and highly defamatory comments." He stated that LiraCoin Damo Organization was considering legal action in both Europe and the USA. This type of threat is common from fraudulent operations. Williams failed to specify any inaccuracies in the review. A response was sent pointing this out, but no further communication has been received from Williams or LiraCoin DAMO Organization. It remains unknown if a similar legal threat was sent to CONSOB.