CEO of Titanium Blockchain pleads guilty in $21 million cryptocurrency fraud scheme

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SAN FRANCISCO, (WRIC) — The CEO of Titanium Blockchain Infrastructure Services Inc. (TBIS) has pleaded guilty to his role in a $21 million cryptocurrency fraud scheme.

Court documents state that 54-year-old Michael Alan Stollery of Reseda, California, was the CEO and founder of TBIS, a purported cryptocurrency investment platform.

According to a release from the Department of Justice, Stollery lured investors to purchase “BARs,” the cryptocurrency token offered by the company’s initial coin offering (ICO), raising $21 million from the scheme. Stollery did not register the ICO with the U.S. Securities and Exchange Commission (SEC) even though he was required to do so.

Stollery admitted that he falsified aspects of TBI’s white papers — documents intended to provide investors an explanation of the cryptocurrency investment offering — in order to entice investors. The DOJ said Stollery also planted fake client testimonials on TBI’s website and falsely claimed that he had business relationships with the Federal Reserve and dozens of other prominent companies to project legitimacy. He also admitted to using some of the money received from investors for personal payments, such as a condominium in Hawaii.

Stollery pleaded guilty to one count of securities fraud. He is scheduled to be sentenced on November 18 and could receive up to 20 years in prison.