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SEC imposes additional fraud charges on Centra Tech over fraudulent ICO scheme

BBR Staff Writer Published 23 April 2018

The US Securities and Exchange Commission (SEC) has imposed additional fraud charges on Centra Tech over allegations related to its $32m initial coin offering (ICO) scheme.

As per amended complaint, SEC has accused one of Centra’s co-founders, Raymond Trapani, in relation to the fraudulent scheme, under which the firm issued CTR Tokens to investors.

At the starting of this month, SEC and criminal authorities accused Centra’s two other co-founders, Sohrab Sam Sharma and Robert Farkas, over allegations linked to their roles in the scheme. 

The amended complaint of SEC states that Trapani was a mastermind of Centra’s fraudulent ICO, which allegedly cheated investors with promises of business relationships with major credit card companies.

SEC’s amended complaint further states that Trapani and Sharma manipulated trading in the CTR Tokens to generate interest in the company and prop up the price of the tokens. 

SEC’s amended complaint has been filed in Manhattan, charging Trapani with breaching the anti-fraud and registration provisions of the federal securities laws

The amended complaint is said to seek permanent injunctions, return of allegedly ill-gotten gains plus interest and penalties, in addition to bars against Trapani prohibiting him from serving as a public company officer or director and participating in any offering of digital or other securities.

SEC enforcement division’s cyber unit chief Robert Cohen said: “We allege that the Centra co-founders went to great lengths to create the false impression that they had developed a viable, cutting-edge technology.

“Investors should exercise caution about investments in digital assets, especially when they are marketed with claims that seem too good to be true.”

In an analog action, the US Attorney’s Office for the Southern District of New York announced criminal charges against Trapani.

The Commission’s investigation, which is continuing, is being carried out by Jon Daniels, Luke Fitzgerald, and Alison Levine of the Cyber Unit and New York Regional Office.


Image: The US SEC has imposed fraud charges on Centra Tech’s co-founders over fraudulent ICO scheme. Photo: courtesy of hywards / FreeDigitalPhotos.net.