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Titanium Blockchain CEO admits $21M ICO scam
Michael Alan Stollery, the project's CEO, pled guilty to one count of securities fraud and faces life in prison.
Titanium Blockchain founder and CEO Michael Alan Stollery pled guilty to participating in a fraudulent initial coin offering (ICO) for $21 million.
Stollery's business was unregistered and full of lies.
Stollery was charged with securities fraud in a Los Angeles district court earlier this month. The prosecution said that Stollery used fabricated data to entice naïve investors to acquire "BARs," a crypto currency generated by his business, which was supported by ridiculous promises about the token's potential upside.
Stollery also forged white papers, misinforming others about his initiative and its underlying digital infrastructure. Furthermore, he falsified countless client testimonials on the Titanium Blockchain official website, as well as misrepresenting about his company's relationships.
Stollery raised around $21 million through Titanium's initial coin offering between November 2017 and January 2018. However, the ICO was not required to be registered with the American Securities and Exchange Commission (SEC), rendering his entire operation unlawful from the start.
Stollery may spend up to 20 years in jail.
Stollery entered the guilty plea after admitting to using the unlawfully obtained funds to pay for personal costs such as credit card payments and other charges accrued during his frequent trips to Hawaii.
Titanium's assets were frozen in 2018 because Stollery lied about his professional affiliations with the Federal Reserve and other global corporations such as PayPal and Verizon.
Stollery's defense attorney, Andrew Holmes, indicated that the guilty plea stems directly from the SEC's claims, adding:
“It was overexuberance that went beyond what he should’ve done. Mr. Stollery is very remorseful and he wants to get as much money as possible back to those that put their money in,”
As of press time, Stollery was released from police custody on a signature bail. He risks a life sentence of up to 20 years in jail, as well as additional potential monetary penalties. On November 18, he will be sentenced.
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