For Mayweather, investing in ICO isn't as much successful as the boxing ring
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Loading...The US Securities and Exchange Commission has halted the business operations of Centra Tech according to an official press release in which it refers to the company as a “fraudulent scheme”.
The complaint is aimed at the two co-founders of the company, Sohrab “Sam” Sharma and Robert Farkas, who have both been arrested. Farkas had apparently bought plane tickets but was apprehended before he could leave the country.
The ICO raised more then 32 million dollars in September of last year, helped in no small part by endorsements from retired boxer Floyd “Money” Mayweather and recording artist DJ Khaled.
The SEC alleges that while the company claimed to be developing a cryptocurrency debit card in partnership with Visa and Mastercard, no such relationships existed in reality.
Sharma and Farkas are also accused of displaying “fictional executives with impressive biographies” on the company website and paying celebrities to advertise the ICO on social media.
Stephanie Avakian, Co-Director of the SEC’s Division of Enforcement, said: “We allege that Centra sold investors on the promise of new digital technologies by using a sophisticated marketing campaign to spin a web of lies about their supposed partnerships with legitimate businesses. As the complaint alleges, these and other claims were simply false.”
he regulator is seeking the return of ill-gotten gains plus interest and penalties. In addition, the US Attorney’s Office for the Southern District of New York has announced criminal charges against Sharma and Farkas.
The SEC statement does not mention the celebrity endorsements, but the two stars should be wary; in November 2017 the regulator warned celebrities that if they endorse a product they must fully disclose all compensation received, in accordance with American securities laws. Floyd Mayweather specifically has been involved in the promotion of two other multi-million dollar ICOs.
Source: Finance Magnates
Original post: SEC Calls Mayweather-Endorsed Firm Fraudulent, Owners Arrested
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