CEO of fraudulent crypto firm pleads guilty to securities fraud.
A press release by the US Department of Justice (DoJ) on Monday reveals that the CEO of Titanium Blockchain Infrastructure Services, Michael Alan Stollery, has pleaded guilty to security fraud after he and his firm, in a fraudulent scheme, raised $21 million from investors in an initial coin offering in 2018.
According to the release, the court documents show that Stollery, aged 54, lured investors to buy “BARs,” the company’s blockchain token, through a series of false claims. Additionally, Stollery failed to register TBIS’s ICO with the SEC despite being required to do so under US securities law.
The press release further reveals that Stollery admits to falsifying details in the project’s white paper to attract investors. Notably, Stollery claimed to be in business with several known businesses and agencies, including the Federal Reserve, to inspire confidence, going as far as falsifying testimonials on the company’s website.
The TBIS’s chief further admits that the firm failed to execute the promises made to investors after raising over $21 million from investors in the United States and overseas. Instead, Stollery admits to using part of the funds raised to settle personal bills and maintain a condominium in Hawaii.
It is worth noting that Stollery and his firm were first charged with securities fraud in May 2018. By pleading guilty to one count of securities fraud, Stollery faces up to 20 years in jail. Stollery is scheduled to be sentenced on November 18.
It is worth noting that the US DoJ continues to show increased efficiency in prosecuting technology and crypto-related fraud cases. For example, at the beginning of this month, the US Doj revealed that a former Apple Lawyer pleaded guilty to insider trading just weeks after it had indicted a former OpenSea executive for similar crimes.