Regulation News
- The CEO of Titanium, Michael Alan Stollery, pleaded guilty on Friday for his role in a crypto fraud.
- He allegedly did not register Titanium’s ICO with the SEC, faked its whitepaper, planted phony testimonials, and swindled investor funds.
- Stollery is scheduled to be sentenced in November and faces up to 20 years in prison.
On Monday, the U.S. Department of Justice Office of Public Affairs published a press release stating that the CEO of Titanium Blockchain Infrastructure Services Inc. (TBIS) pleaded guilty for his role in a crypto fraud scheme involving TBIS’s initial coin offering (ICO) that raised approximately $21 million from investors.
According to the press release, Michael Alan Stollery, the CEO and founder of TBIS, attempted to sell TBIS as a cryptocurrency investment opportunity, luring investors to purchase its token — BAR through a series of false and misleading statements.
Moreover, Stollery did not register the ICO regarding TBIS’s cryptocurrency investment offering with the SEC. He also lacked a valid exemption from the SEC’s registration requirements.
Stollery admitted that he falsified aspects of TBIS’s white papers. The tech leader also planted fake client testimonials on TBIS’s website and falsely claimed that he had business relationships with the Federal Reserve and several major firms to trick investors.
When questioned further, Stollery admitted that he did not use the invested money as promised but instead merged the ICO investors’ funds with his personal funds, using some of it for his own needs, such as credit card payments and the payment of bills for his Hawaiian property.
Stollery pleaded guilty and is scheduled to be sentenced on November 18. He faces up to 20 years in prison.
Andrew Holmes, the lawyer who represents Stollery, stated the plea was the criminal follow-up to the SEC action. Holmes also claimed that Stollery had intended to run Titanium Blockchain as a legitimate business but fell prey to overexuberance.
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