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Centra co-creator jailed for one year over alleged $25m ICO fraud

Centra co-creator

December 18, 2020

Reading Time: 2 minutes

Robert Farkas, the co-creator of Centra Tech will be spending the next coming year behind bars accompanied by a penalty on profits and procurements. Robert was among the creators of Centra Tech, a crypto firm based in Miami, was apprehended and imprisoned after being found guilty of stock fraud.

Farkas confesses to the crime

As per a US Attorney’s Office report, the perpetrator had confessed and took responsibility.  Farkas accepted scamming sponsors’ charges to raise a $26 million fund after spreading false statements at an ICO held in 2017. Some of the top public figures, musician DJ Khaled and boxer Floyd Mayweather are now in legal problems after being involved in the firm’s promotion. The two get on the wrong side of the law as they failed to reveal that Centra paid them.

Fake partnership allegations

Robert Farkas misused a collaboration deal with other fiscal firms, Visa and Mastercard, to solicit money from sponsors. These frauds further, apart from made up partnerships, alleged to own a money transmitter permit. He claimed to be licensed in 38 states in the US and tainted the project personnel and their passes.

The Attorney for the US, Ilan T. Graff, said that the perpetrators and other culprits involved made false executives and made-up business ties. They implicated other unaware legit firms to coax investors to give them massive amounts of money for a scam ICO.

Reaping the fruits

A Manhattan federal court publicized Farkas sentence. He has been sentenced to a one-year prison term and three years of manned release and will have to give up around $347,000, and a Rolex watch purchased using the fraud money.

This scam scheme appeared very authentic and was able to rip off a few too many investors. In July 2017, at an ICO, the firm accumulated more than 100,000 ETH, worth at least $25 million at that period claiming to be selling its CTR currency. However, the funds were retrieved in 2018 when the FBI working with the US Attorney’s office, confiscated 100,000 ETH from Centra.

At the beginning of 2020, the US Marshals Services traded the ETH for $33.4 million. This money will be utilized in the compensation of the fraud victims.

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