The Colorado Department of Regulatory Agencies (DORA) announced its investigation of two companies for promoting unlawful Initial Coin Offerings (ICOs) to Colorado residents, the Denver Post reported May 3.

The Colorado Securities Commissioner said that California-based Linda Healthcare Corp. and Washington-based Broad Investments LLC could potentially be violating Colorado securities law by promoting ICOs.

DORA discovered that Linda Healthcare is promoting a “LindaHealthCoin” token on its website, which ostensibly can be used to purchase Linda Healthcare’s insurance. According to the website, the token can buy telemedical coverage “through an artificial intelligence chat service that creates medical solutions through use of blockchain technology.”

According to DORA, Linda Healthcare offers no warnings that ICOs constitute a security in the state of Colorado. “The Linda Health Insurance network is, to date, not in operation,” officials reported. A March 19 tweet from the firm directs potential customers to consult its white paper.

As Denver Post reports, Broad Investments firm is allegedly promoting cryptocurrency using a token that is described on its website as “an equity coin that represents shares of the company, like company stocks.” The token would ostensibly give holders a right to a share in returns from Broad Investments’ strategy, which builds stock portfolios with an algorithm. Officials say that the “math-oriented value system” on the website was not operational.

DORA representatives reported that both companies did not provide any information on the risks of investing in crypto or ICOs on their websites. Colorado Securities Commissioner Gerald Rome commented that investments in ICO tokens should be done carefully: “Investment opportunities being sold through ICOs over the internet need to be approached with the same level of caution as for any highly risky investment venture.”

The firms must now prove why the should not be sanctioned under the Colorado Securities Act, according to which the firms will receive cease and desist orders.

Earlier in March, the Massachusetts Securities ‎Division issued consent orders requiring the permanent suspension of five firms’ unregistered ICO sales, citing that the companies were selling unregistered securities.