SafeMoon CTO Pleads Guilty in $200 Million Crypto Fraud Case
- SafeMoon CTO Thomas Smith admits to securities fraud conspiracy and wire fraud conspiracy charges.
- US authorities arrested Smith and CEO Braden John Karony in 2023.
Thomas Smith, the chief technology officer of SafeMoon LLC, has pleaded guilty to charges of securities fraud conspiracy and wire fraud conspiracy. This plea was made in a Brooklyn federal court on Feb. 20, reversing Smith’s earlier denial of the charges.
Safemoon CTO’s Admission
In his plea, Smith confessed to misleading investors about SafeMoon’s liquidity pool and making false claims about locked assets. Prosecutors allege that Smith and CEO Braden John Karony diverted funds for personal use, leading to SafeMoon filing for bankruptcy in December 2023.
Judge Cheryl Pollak recommended that the US District Judge Eric Komitee accept Smith’s guilty plea, which could result in a potential 20 years in prison for wire fraud conspiracy and up to 25 years for securities fraud.
Arrest of SafeMoon Executives
The charges against Smith, Karony, and SafeMoon creator Kyle Nagy stem from a 2023 investigation into the crypto project. US prosecutors sued the executives for misleading investors about the SFM token, including allegations of wire fraud, securities fraud conspiracy, and money laundering.
Prosecutors claim that the defendants used over $200 million from investor funds for luxury purchases like cars and real estate. While Smith and Karony were promptly arrested after the indictment, Kyle Nagy remains at large.
