One of the co-founders of the Centra Tech ICO, Sohrab Sharma, plead guilty before the US District court in New York for scamming investors out of $25 million. Apart from Sharma, two more associates of his also plead guilty for cyber crimes.
Another co-counder, Raymon Trapani, who cooked up the entire scheme, plead guilty to nine counts of fraud last year.
The scam was conducted between July 2017 and March 2018. Investors were promised to receive a “Centra Card” which was supposed to function like a cryptocurrency debit card and was also supposed to be accepted by any vendor accepting Visa and Mastercard. To convince investors that was possible the scammers falsified licensing agreements with the above-mentioned companies, as well as with Bancorp. They also lied to investors that their company had an US license in 38 different states, was led by a CEO with 20 years of experience and a Harvard degree, and hired boxer Floyd Mayweather and DJ Khaled to promote them.
Mayweather and DJ Khaled were heavily fined for their participation in the scam as well.
What amazes me is that people ready to invest in this scam did not think to call Mastercard and Visa to double check this so-called licensing agreement, and just blindly gave these scammers millions of dollars.