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The third co-founder behind the $ 25 million ICO scam pleads guilty

July 14, 2020

Sohrab Sharma, one of the co-founders of cryptocurrency company Centra Tech, accused of fraud with an initial coin offering of $ 25 million, would plead guilty.

According to a Bloomberg report on July 13, Sharma has since been able to avoid a November trial date His lawyers told a federal judge that he would be interested in changing his testimony.

The announcement comes after Sharma employee Robert Farkas was convicted of conspiracy to commit securities and transfer fraud on June 16. Farkas faces up to 87 months in prison and a $ 250,000 fine.

A story of fraud

The third co-founder behind the $ 25 million ICO scam pleads guiltyThe third co-founder behind the $ 25 million ICO scam pleads guilty

The U.S. Department of Justice (DOJ) said Sharma, Farkas and Raymond Trapani were arrested in April 2018.

All three would have lied to investors because they had a fictional CEO at Centra Tech, Michael Edwards, and a license for money transmitters in 38 countries. The company provided false information about partnerships with large companies, including visas.

According to charges from the Department of Justice, the trio of these hoaxes aimed to get people to invest in Centra Tech’s initial coin offering (ICO) from Centra Tech tokens, also known as CTR tokens.

Celebrity support

When the ICO took place between July and October 2017, it was supported by celebrities, including former professional boxer Floyd Mayweather and music producer DJ Khaled.

As a result, the Securities and Exchange Commission (SEC) accused both men of illegally promoting the ICO and of not forwarding payments received from Centra Tech to their followers.

The case of the third co-founder of this company, Trapani, is due to go to trial in November.