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A grand jury in the Southern District of New York has put on trial Centra Tech’s three co-founders. A press release was issued on May the 14th by The U.S. Attorney’s Office of the district announcing the prosecution.

The Centra Tech Scam

The three co-founders of Centra Tech Sorhab Sharma, Raymond Trapani, and Robert Farkas, allegedly tried to deceive crypto investors through an initial coin offering. The trio was arrested in April 2018 and they were all indicted for fraud. Commenting on the accusation, Robert Khuzami, Deputy U.S. Attorney for the Southern District of New York, said the following:

“As alleged, the defendants conspired to capitalize on investor interest in the burgeoning cryptocurrency market.  They allegedly made false claims about their product and about relationships they had with credible financial institutions, even creating a fictitious Centra Tech CEO.  Whether traditional or cutting-edge, investment vehicles can’t legally be peddled with falsehoods and lies.”

The three men were accused of allegedly requesting investors to acquire unregulated securities. These securities consisted of CTR digital currency tokens which were offered in an illegal ICO.

The Centra Tech founders also misled investors into believing the company was involved in collaborations with reliable corporations. Part of the ICO marketing agenda comprised of supposed partnerships with Visa, Mastercard, Bancorp. Centra Tech also claimed it managed to secure a money transmitter license in 38 U.S. states.

The fraud company managed to gather from investors around 91,000 ether tokens, which are currently valued at $60 million. The project was also endorsed by celebrities such as boxing champion Floyd Mayweather, and rapper DJ Khaled. The SEC soon exposed that the Centra Tech project was a fraud, after which the co-founders were arrested.

Sharma, Trapani, and Farkas are looking at a total of 65 years in prison based on the charges brought against them. The three co-founders are also accountable to pay financial penalties, and they will be kept into custody while they wait for the court’s next action.

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