Crypto News – The U.S. Department of Justice has charged the founder and two key executives of SafeMoon, a cryptocurrency whose eponymous token was once valued at over $8 billion, with spearheading a fraud that siphoned off tens of millions of investor funds to fund their lavish lifestyles.
Breaking News: SafeMoon Executives Charged with Crimes Including Fraud and Money Laundering
Founder Kyle Nagy, Chief Executive Braden John Karony, and former Chief Technology Officer Thomas Smith were each charged with three counts of criminal conspiracy, including securities fraud, wire fraud, and money laundering, in an indictment that was released in Brooklyn on Wednesday.
Regarding the defendants and the alleged unregistered sale of the SafeMoon token by the Provo, Utah-based corporation, the U.S. Securities and Exchange Commission filed related civil charges. SafeMoon, which was founded in March 2021 and minted one quadrillion tokens, is accused of lying to investors by saying that their funds were securely stored in pools to increase the token’s liquidity and that no one could take them out.
As alleged, the defendants deliberately misled investors and diverted millions of dollars to fuel their greedy scheme and enrich themselves by purchasing a custom Porsche sports car, other luxury vehicles, and real estate.
Breon Peace, U.S. Attorney
SafeMoon Executives Failed to Get Users to the Moon Safely
Additionally, according to court documents, SafeMoon assured investors that the features of the token will “drive the price to stratospheric all-time highs” and “Safely to the Moon.” Investigators stated that this was not the case, since investors lost a lot of money when they discovered the pool was unlocked, and the defendants took money out to purchase fancy mansions, pricey vacations, and sports vehicles like Porsche and McLaren.
Instead of rewarding their clients as promised, their insatiable greed led them to spend millions of dollars on their own lavish desires. Today, no luxury vehicles or sprawling real estate can protect them from the consequences of such crimes.
Ivan Arvelo, a US Department of Homeland Security agent
Additionally, through wash trading, the SEC discovered that its senior executives were attempting to inflate SFM coins and draw in new SFM investors. John Karony and Thomas Smith were detained on charges of conspiring to commit wire fraud, money laundering conspiracy, and securities fraud. The Justice Department (DOJ) also announced action against the SafeMoon project on the same day.
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