Titanium Blockchain CEO behind BARs ICO fraud, put behind bars for 4 years
The California-based CEO of Titanium Blockchain has been sentenced to four years of prison — putting an end to a 2018 initial coin offering (ICO) saga that stripped investors of $21 million.
Michael Stollery, who founded Titanium Blockchain Infrastructure Services (TBIS), was a key figure in a “cryptocurrency fraud scheme” which involved an initial coin offering for TBIS — conducted between late 2017 and early 2018, according to the Department of Justice.
Investors purchased a crypto token called BARs to participate in the ICO. Approximately $21 million was raised from the United States and overseas, according to the Department of Justice.
However, in a United States Securities and Exchange Commission (SEC) complaint in 2018, Stollery was accused of not having registered the ICO with the regulator, among other accusations.
In July 2022, he pleaded guilty to one count of securities fraud for his role in the “fraud scheme.”
He admitted to falsifying aspects of TBIS’ whitepapers and planting fake client testimonials on the TBIS website, along with falsely claiming business relationships with the United States Federal Reserve — all of which served to mislead investors about the TBIS’ legitimacy and prospects for profit.
He also admitted to commingling ICO investors’ funds with his own, using a portion to pay for unrelated expenses such as credit card bills and bills for his Hawaii condominium, according to the SEC.
Though he was facing up to 20 years of prison, he will instead serve a total of four years and three months in prison for his involvement.
Related: Euler Finance exploiter returns over 58,000 stolen Ether
The SEC has been ramping up actions against the cryptocurrency space in recent years.
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