- Centra co-founder Robert Farkas has pleaded guilty to fraud charges over the $32 million ICO
- Farkas was accused of lying about the intentions of the project and the fabrication of team members
- Floyd Mayweather and DJ Khaled promoted the project in 2017
One of the founders of Centra, the cryptocurrency project that lied about numerous facets of its project and swindled investors for more than $32 million, has pleaded guilty to fraud charges. Robert Farkas and his co-conspirators Sohrab Sharma and Raymond Trapani cooked up Centra while working at a luxury car rental service and took investors’ money based on false claims about the project’s status, plans, and team members. Three years after the project first appeared on the crypto scene however, Farkas now faces a spell in prison after admitting the fraud.
Centra’s $32 Million Bag of Lies
Centra came on the scene in July 2017 promising, among other things, a cryptocurrency debit card at a time when they were still in their infancy. The company had targeted a $25 million ICO raise and ended up with $32 million, thanks in no small way due to their usage of boxer Floyd Mayweather and DJ Khaled in promotional material, who were themselves indicted for illegally promoting a security.
Just weeks after the ICO concluded, Trapani and Sharma left the company following a critical piece in the New York Times which highlighted their complete lack of business experience and their hankering for luxury items. Less than a month after this, disgruntled investors took Centra to court over U.S. securities laws violations, claiming they had been misled over the project and the team.
The complaints centered around the lack of a debit card despite promises to the contrary, and the fact that the founders had made up a CEO who they claimed was educated at Harvard. This was in addition to the small matter of where their money had gone.
From Denial To Prison
Despite initially denying the allegations against Centra back in 2017, Farkas pleaded guilty to conspiracy to commit securities fraud and wire fraud on Tuesday. He was in line for as much as a decade in prison but agreed a deal with prosecutors of a sentence of 70 to 87 months and a fine of up to $250,000. Trapani and Sharma are scheduled for trial in November.