Last Updated: December 5, 2025 | Word Count: ~4,800 | Reading Time: 19 minutes
Quick Facts
| Specification | Value |
| Project Name | AriseBank |
| Token Symbol | ACO (AriseCoin) |
| Status | ❌ Fraud – Founders Prosecuted |
| Category | Banking / Crypto Bank |
| ICO Period | Late 2017 – Early 2018 |
| Claimed Raise | $600 Million (false) |
| Actual Investor Losses | ~$4 Million |
| Founders | Jared Rice Sr., Stanley Ford |
| Main Fraud | Fake FDIC insurance, fake bank acquisition |
| SEC Action | January 2018 |
| Criminal Sentence | Rice: 5+ years federal prison |
Table of Contents
- Executive Summary
- What Was AriseBank?
- The Fraudulent Claims
- The Founders
- SEC Shutdown
- Criminal Prosecution
- Lessons Learned
- Frequently Asked Questions
- Sources & References
Executive Summary
In late 2017, AriseBank announced itself as revolutionary: the “world’s first decentralized bank” that would offer FDIC-insured accounts, a Visa debit card for spending hundreds of cryptocurrencies, and all the benefits of traditional banking with none of the restrictions.
The marketing was slick. Celebrity endorsements amplified the message. The ICO reportedly raised hundreds of millions of dollars—at least according to AriseBank’s own claims.
There was just one problem: none of it was true.
AriseBank had not acquired an FDIC-insured bank. The FDIC insurance claims were fabricated. The Visa partnership didn’t exist. The “$600 million raised” was a fantasy designed to create FOMO.
In January 2018, the SEC obtained an emergency asset freeze, making AriseBank one of the earliest major crypto enforcement actions. Founder Jared Rice Sr. was later indicted on federal criminal charges and sentenced to over 5 years in prison.
AriseBank is a case study in audacious lying—a project that didn’t just exaggerate, but fabricated core claims about regulatory status and institutional partnerships. It demonstrates that in the 2017 ICO frenzy, some promoters believed they could say absolutely anything without consequence.
They were wrong.
What Was AriseBank?
The Vision (As Marketed)
AriseBank positioned itself as the bridge between traditional banking and cryptocurrency:
Claimed Features:
- Full-service banking (checking, savings, loans)
- FDIC insurance on deposits
- Visa debit card accepting 700+ cryptocurrencies
- Instant crypto-to-fiat conversion
- Mobile banking app
- “Decentralized” structure
The pitch combined the trust of traditional banking with the innovation of crypto—a compelling narrative for investors tired of banks that wouldn’t touch cryptocurrency.
AriseCoin (ACO)
The ICO offered AriseCoin (ACO) tokens:
| Specification | Value |
| Token | ACO |
| Platform | Ethereum (ERC-20) |
| Claimed Use | Banking platform utility |
| Marketing | “Invest in the first crypto bank” |
The Marketing Machine
AriseBank invested heavily in promotion:
- Professional website
- Explainer videos
- Social media campaigns
- Celebrity endorsements (including claims of boxer Evander Holyfield’s involvement)
- Press releases to crypto and mainstream media
The claimed fundraising numbers—”$600 million toward $1 billion goal”—were designed to create urgency and social proof.
The Fraudulent Claims
Fake FDIC Insurance
The Claim: AriseBank told investors their deposits would be FDIC-insured, providing the same protection as traditional bank accounts.
The Reality: AriseBank had absolutely no FDIC insurance. The FDIC (Federal Deposit Insurance Corporation) only insures deposits at member banks that meet strict regulatory requirements. AriseBank was not a bank and had no path to FDIC membership.
Why This Matters: FDIC insurance is a core promise of safety. Claiming it falsely is serious fraud that deceives investors about fundamental risk.
Fake Bank Acquisition
The Claim: AriseBank stated it had acquired, or was acquiring, an FDIC-insured bank, giving it immediate regulatory legitimacy.
The Reality: No such acquisition existed. AriseBank had not purchased any bank, was not in negotiations to purchase any bank, and had no banking license or charter.
Fake Visa Partnership
The Claim: AriseBank promoted a Visa debit card that would work with hundreds of cryptocurrencies.
The Reality: Visa had no relationship with AriseBank. The card program was fabricated. No functional product existed.
Inflated Fundraising Claims
The Claim: AriseBank publicly stated it had raised approximately $600 million.
The Reality: According to federal prosecutors, actual investor losses were approximately $4 million. The $600 million figure was marketing fiction designed to create FOMO and perceived legitimacy.
Undisclosed Criminal History
The Reality: Jared Rice Sr. had a prior criminal history that was not disclosed to investors—a material omission for anyone investing based on team credibility.
The Founders
Jared Rice Sr. – CEO
The primary architect of AriseBank:
- Role: CEO and public face
- Background: Entrepreneur with prior business ventures
- Criminal History: Prior convictions not disclosed to investors
- Responsibility: Made or approved the false claims
Rice was the driving force behind AriseBank’s marketing and fundraising, personally making many of the fraudulent representations.
Stanley Ford – Co-Founder
Listed as co-founder and involved in operations:
- Role: Co-founder, operational leadership
- SEC Charges: Named in civil complaint
- Outcome: Resolved civilly without criminal sentence
Ford’s involvement was less public than Rice’s, and his penalties reflected that distinction.
SEC Shutdown
The Investigation
The SEC began investigating AriseBank based on:
- The extraordinary claims (FDIC insurance, Visa partnership)
- Tips and complaints
- Verification failures (FDIC and Visa denied relationships)
- Promotional red flags
January 25, 2018: Emergency Action
The SEC filed an emergency complaint and obtained:
Immediate Relief:
- Asset freeze on all AriseBank and founder accounts
- Receiver appointed to take control of the company
- Website takedown
- Operations halted
Charges:
- Securities fraud (misrepresentations and omissions)
- Unregistered securities offering
- Violations of antifraud provisions
SEC Statement
The SEC’s press release emphasized the brazen nature of the fraud:
> “We allege that AriseBank and its principals sought to raise hundreds of millions of dollars through their fraudulent ICO.”
The case was handled by the SEC’s Cyber Unit, following their PlexCoin action the previous month.
Receiver Findings
The court-appointed receiver found:
- No evidence of a functional banking platform
- No bank acquisition in progress
- No Visa relationship
- Funds used for personal expenses and marketing
- Dramatically inflated fundraising claims
Criminal Prosecution
DOJ Indictment
Following the SEC civil action, the Department of Justice brought criminal charges against Jared Rice Sr.:
Counts:
- Wire fraud conspiracy
- Wire fraud
- Securities fraud
- Related offenses
The Criminal Case
The indictment detailed:
- The FDIC Lie: Rice falsely claimed FDIC insurance knowing it was false
- The Bank Lie: Rice claimed bank acquisition knowing no such deal existed
- Fund Misuse: Investor money used for personal expenses
- Scale of Deception: Coordinated campaign of false statements
Guilty Plea and Sentencing
Rice ultimately pleaded guilty to federal charges.
Sentence: Over 5 years in federal prison
Additional penalties included:
- Restitution orders (millions owed to victims)
- Supervised release following prison
- Permanent bars from securities activities
Stanley Ford
Ford was named in the SEC civil case but did not face the same criminal prosecution as Rice. His resolution was civil:
- Injunctions
- Monetary penalties
- Industry bars
Lessons Learned
For Investors
1. Verify Regulatory Claims FDIC insurance can be verified on the FDIC’s website. Visa partnerships can be confirmed with Visa. Never trust—always verify.
2. “$600 Million Raised” Is a Red Flag When claims seem designed to create FOMO rather than provide information, be skeptical. Extraordinary claims require extraordinary evidence.
3. Check Founder Backgrounds Rice’s criminal history should have been disclosed. Basic background checks protect against repeat offenders.
4. “Decentralized Bank” Is an Oxymoron Banks are heavily regulated centralized institutions. Slapping “decentralized” on something doesn’t change regulatory reality.
5. If It Combines Everything You Want… FDIC insurance + crypto + Visa + mobile + decentralized? Too good to be true means too good to be true.
For the Industry
1. Celebrity Endorsements Require Scrutiny Celebrities who endorse crypto projects without due diligence face legal and reputational risk.
2. Exchange Due Diligence Platforms that hosted AriseBank’s ICO could have verified basic claims before listing.
3. Media Responsibility Outlets that covered AriseBank’s “$600 million” claims without verification amplified the fraud.
For Regulators
AriseBank validated aggressive enforcement:
- Emergency actions work
- Criminal referrals are appropriate for clear fraud
- Asset freezes prevent fund dissipation
- Coordination between SEC and DOJ is effective
Frequently Asked Questions
What was AriseBank?
AriseBank was a fraudulent ICO that claimed to be the “world’s first decentralized bank,” offering FDIC-insured accounts and a Visa debit card for cryptocurrencies. All major claims were false.
Was AriseBank actually FDIC insured?
No. AriseBank had no FDIC insurance, no FDIC membership application, and no path to becoming a legitimate insured bank. The claim was entirely fabricated.
Who founded AriseBank?
Jared Rice Sr. was the CEO and primary founder. Stanley Ford was listed as co-founder. Rice was later sentenced to over 5 years in federal prison.
How much did AriseBank raise?
AriseBank claimed to have raised $600 million, but this was false. Actual investor losses were approximately $4 million according to federal prosecutors.
What happened to Jared Rice Sr.?
Rice was charged with federal wire fraud and securities fraud. He pleaded guilty and was sentenced to over 5 years in federal prison, plus ordered to pay restitution.
Did investors get their money back?
Limited recovery occurred through the court-appointed receiver and asset freeze. However, as with most fraud cases, full recovery is rare.
How did the SEC find out?
The SEC investigated based on the extraordinary nature of the claims. Simple verification—calling FDIC and Visa—revealed the claims were false.
Is AriseCoin still tradeable?
The ACO token is worthless and the project is defunct. There is no legitimate market for it.
Sources & References
- SEC Press Release – “SEC Halts Alleged Fraudulent ICO” (January 2018) – sec.gov
- SEC Press Release – “Defendants Settle AriseBank Case” – sec.gov
- DOJ Press Release – “Cryptocurrency CEO Indicted After Defrauding Investors” – justice.gov
- Harvard Law School Forum – “Cleary Discusses SEC’s Freeze of Decentralized Bank ICO” – corpgov.law.harvard.edu
- Proskauer – “SEC Shuts Down AriseBank’s Celebrity-Endorsed ICO” – proskauer.com
- Georgetown Law Tech Review – “Initial Fraud Offering: SEC Takes Action Against ICOs” – georgetownlawtechreview.org
Disclaimer
This article is for informational and educational purposes only. It does not constitute financial, investment, or legal advice. Cryptocurrency investments carry significant risk. Always conduct your own research (DYOR).
Article by: LAB Blockchain Summit Research Team Category: Crypto Fraud | SEC Enforcement Tags: arisebank, ACO, FDIC fraud, jared rice, crypto bank scam, SEC