US federal prosecutors are requesting US District Judge Lorna Schofield to sentence a fraudster behind a celebrity-endorsed ICO to a long term in prison. A report unveiled this news on November 4, noting that the prosecutors filed a sentencing submission on October 31, demanding a harsh sentence against Robert Joseph Farkas, the co-founder of Centra Tech. Reportedly, the company conducted a fraudulent ICO backed by Floyd Mayweather and DJ Khaled in 2017.
In the sentencing submission, the prosecutors claimed that they are seeking harsh punishment for Farkas to prevent other fraudsters from conducting illicit ICOs. Per the prosecutors, legitimate ICOs create a new and effective method of raising capital. However, fraudulent ICOs cause the loss of investor confidence, making it difficult for honest coin issuers to raise capital through crypto coins.
The prosecutors went on to suggest that Judge Schofield should issue a substantial sentence against Farkas to send a strong message to other scammers that seek to use digital assets and new technologies to commit old-fashioned fraud.
Home imprisonment is not enough punishment
The prosecutors made their submission after Farkas submitted his on October 23. In his submission, Farkas claimed that he had played an indisputably minor role in the scheme. As such, he requested sentencing of the 55 days he had already served plus home confinement and a substantial amount of community work.
However, the prosecution disagreed saying,
“Farkas’s undeniable criminal conduct speaks for itself. Day in and day out, for approximately nine months, Farkas participated in a scheme that directly caused losses of tens of millions of dollars in funds from hundreds of victim investors. His participation continued even in the aftermath of the mounting criticism he faced as a result of the New York Times article, which revealed many of the lies that he and his co-conspirators used to lure investors. The methods that Farkas employed to lure victims, and then work to cover up the scheme by attempting to create a company and a product that lived up to the lies he perpetrated, evince the serious nature of his conduct and his role in the scheme which, while minor compared to Sharma and Trapani, was nonetheless significant and ongoing in nature.”
The prosecution office went on to state that federal guidelines recommend between 70 and 87 months in prison for committing such an offense. On the other hand, the probation office suggested 60 months.
A £19.2 million scheme
This news comes after Farkas pled guilty to two counts of fraud on June 16, this year. He reportedly accepted that he had conspired to commit securities and wire fraud by leading a scheme that defrauded US investors out of more than £19.2 million. Farkas’ co-conspirators Sam Sharma and Raymond Trapani also pled guilty to similar charges.