SEC Calls Mayweather-Endorsed Firm Fraudulent, Owners Arrested
- Centra Tech made $32 million from its ICO last year.
The US Securities and Exchange Exchange An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv Read this Term 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 than 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.
Centra's (CTR) ICO starts in a few hours. Get yours before they sell out, I got mine https://t.co/nSiCaZ274lpic.twitter.com/dB6wV0EROJ
— Floyd Mayweather (@FloydMayweather) September 18, 2017
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 Marketing Marketing is defined as the business process of identifying, anticipating and satisfying customers' needs and wants.This is a crucial element of any operation or brokerage in the financial services space. Well-funded marketing campaigns are instrumental to the survival and longevity of these companies in an increasingly competitive industry.Within the forex space, marketers perform a wide range of functions to help procure, secure, or retain clients.In particular, newer forex brokers also have t Marketing is defined as the business process of identifying, anticipating and satisfying customers' needs and wants.This is a crucial element of any operation or brokerage in the financial services space. Well-funded marketing campaigns are instrumental to the survival and longevity of these companies in an increasingly competitive industry.Within the forex space, marketers perform a wide range of functions to help procure, secure, or retain clients.In particular, newer forex brokers also have t Read this Term 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."
The 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.
Centra Tech was the target of a class action lawsuit in December of last year. The suit targeted the company, the aforementioned pair, and two other associated individuals named Raymond Trapani and William Hagner. According to CoinDesk, Sharma and Trapani exited the company soon after the ICO ended.
The lawsuit made similar allegations to the current SEC complaint. The plaintiffs wanted their money back.
At the time, a Centra Tech spokesperson told Observer: “The allegations are pretty basic. It actually reflects a broader problem of the entire ICO industry. So they got a battle ahead of them.”
The US Securities and Exchange Exchange An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv Read this Term 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 than 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.
Centra's (CTR) ICO starts in a few hours. Get yours before they sell out, I got mine https://t.co/nSiCaZ274lpic.twitter.com/dB6wV0EROJ
— Floyd Mayweather (@FloydMayweather) September 18, 2017
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 Marketing Marketing is defined as the business process of identifying, anticipating and satisfying customers' needs and wants.This is a crucial element of any operation or brokerage in the financial services space. Well-funded marketing campaigns are instrumental to the survival and longevity of these companies in an increasingly competitive industry.Within the forex space, marketers perform a wide range of functions to help procure, secure, or retain clients.In particular, newer forex brokers also have t Marketing is defined as the business process of identifying, anticipating and satisfying customers' needs and wants.This is a crucial element of any operation or brokerage in the financial services space. Well-funded marketing campaigns are instrumental to the survival and longevity of these companies in an increasingly competitive industry.Within the forex space, marketers perform a wide range of functions to help procure, secure, or retain clients.In particular, newer forex brokers also have t Read this Term 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."
The 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.
Centra Tech was the target of a class action lawsuit in December of last year. The suit targeted the company, the aforementioned pair, and two other associated individuals named Raymond Trapani and William Hagner. According to CoinDesk, Sharma and Trapani exited the company soon after the ICO ended.
The lawsuit made similar allegations to the current SEC complaint. The plaintiffs wanted their money back.
At the time, a Centra Tech spokesperson told Observer: “The allegations are pretty basic. It actually reflects a broader problem of the entire ICO industry. So they got a battle ahead of them.”