According to the Ministry of Justice, the CEO of a alleged crypto investment company has pleaded guilty to his role in a crypto fraud program that has raised $ 21 million from investors.
Michael Alan Stollery (aka “Michael Stollaire”), 54, was the CEO and founder of California-based Titanium Blockchain Infrastructure Services (TBIS). He was found guilty of one securities fraud in the US District Court in Central California on Friday and is facing up to 20 years in prison in a sentence scheduled for November. Monday Justice Ministry Announcement..
According to the DOJ, Stollery began offering fraudulent cryptocurrencies in January 2018. The Securities and Exchange Commission has previously sued Stallery and his company and won a ruling to return at least some money to fraudulent investors.
The DOJ said the Stallery seduced investors to buy his company’s cryptocurrencies “through a series of false and misleading statements.” Stollery said, “We don’t use the money we invested as promised, instead we mix ICO investor money with personal money, and according to credit card payments and DOJ press releases, Stollery’s Hawaii condominium bill.” … apparently …
The press release also said:
To seduce investors, Stollery gives investors and future investors the purpose and technology behind the offer, how the offer differs from other cryptocurrency opportunities, etc. He admitted that he had forged aspects of the TBIS white paper that allegedly provided the description of the offer. And the outlook for the profitability of the offering. Stallery also posted a fake customer voice on the TBIS website, falsely claiming that he had a business relationship with the Federal Reserve and dozens of prominent companies, creating a false appearance of legitimacy. did.
The criminal case has been sealed, but the court that filed the DOJ’s allegations filed in May 2022 Available here..
Cryptographic token “has no function”
Titanium sold a utility token called “BAR”, but “at the time of ICO, the token had no function. [initial coin offering]”The DOJ insisted.
As a coin telegraph I will explain, “Utility tokens are a special type of crypto asset whose main purpose is to raise the funds needed to develop a cryptocurrency project.” Utility tokens “do not represent ownership of the project in which they are invested.” “Allows owners to preferentially buy and sell underlying tokens”, “Projects may ultimately benefit token holders” intended with reasonable success Purpose. “
“We emphasized promoting TBIS as an investment, sharing future earnings of TBIS and valuing the value of BAR digital assets,” Stollery said, DOJ said. He also compared his investment in TBIS to buying Google shares for only $ 75 per share, DOJ said.
Stollery also runs a technical consulting services company called EHI, which in a white paper claimed that titanium blockchain “simply inherits EHI’s customers.” Stollery has clients such as Accenture, Apple, Boeing, Cargill, Citizens Bank, eBay, General Electric, HP, Honeywell, IBM, Intel, Microsoft, PayPal, Pfizer, Synchrony Financial, Federal Reserve Bank, Royal Bank of Scotland and Universal. Claimed to be included. Studios, Disney, etc.
“As a result of fraudulent plans … Defendant Stollery has acquired about $ 21 million in the form of various digital assets such as Ether and Bitcoin, with dozens of investments in at least 18 states, including California and abroad. I received cash from my house. Who bought the BAR? “
Prior to announcing the ICO, Stollery used social media to hype titanium blockchain as “a start-up looking to develop an IT platform using blockchain technology,” DOJ said. .. “In various social media accounts, TBIS’s profile included a variation of the following marketing message:” Titanium is a new network building based on blockchain technology, just as steel has changed the building industry forever. It will usher in the times. “