The third co-founder of crypto financial services startup Centra Tech Raymond Trapani has been arrested yesterday, April 20, and charged with securities and wire fraud of more than $25 mln associated with the company’s (ICO), according to the US Department of Justice’s (DOJ) April 20.
The two other co-founders, Sohrab Sharma and Robert Farkas, were of the same offenses earlier in April. Sharma, Farkas, and the now also arrested Raymond Trapani advertised the “Centra Card,” a debit card that was reportedly backed by Visa and Mastercard, which allowed users to convert crypto into currencies.
The (SEC) reports that no partnership actually existed between Centra and the two credit card companies.
According to the DOJ’s press release, after the founder of an unrelated allegedly fraudulent ICO last fall, Sharma asked Trapani and Farkas to remove all false information, “fufu,” about Centra’s deal with Visa from their website: “I rather cut any fufu . . . Now . . . Then worry . . . Anything that doesn’t exist current . . . We need to remove.”
In the DOJ’s press release, Deputy U.S. Attorney Robert Khuzami said,
“As alleged, Raymond Trapani conspired with his co-defendants to lure investors with false claims about their product and about relationships they had with credible financial institutions. While investing in virtual currencies is legal, lying to deceive investors is not.”
Centra Tech had been promoted by celebrities like boxer Floyd Mayweather and DJ Khaled. Last fall, the SEC had that celebrity endorsements of ICOs could be illegal if they don’t reveal the compensation they receive for their advertising.
Published at Sat, 21 Apr 2018 09:32:59 +0000
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