Blockchain & Cryptocurrency

Bitwise CEOs Charged in $70M SEC Fraud Case

Alex Sanchez-Axline

Alex Sanchez-Axline

— 2 min read
Bitwise CEOs Charged in $70M SEC Fraud Case

SEC's Major Fraud Case Against Bitwise Ex-CEOs

The Securities and Exchange Commission (SEC) has recently announced charges against the former co-CEOs of Fresno-based tech startup, Bitwise Industries. This case highlights a significant breach of trust and underscores the importance of transparency in financial dealings.

Founded in Fresno, California, Bitwise Industries emerged as a promising player in the tech services sector. Known for its innovative approach and significant contributions to the local economy, the company's downfall has sent ripples through the tech community.

The SEC's complaint against Jake Soberal and Irma Olguin, Jr. alleges severe misconduct. The duo is accused of presenting falsified bank records and a deceptive audit report to investors, showcasing inflated cash balances and revenues. These actions painted an inaccurately rosy picture of Bitwise’s financial health.

The revelation of this scheme had dire consequences. In May 2023, Bitwise faced a devastating blow as it failed to meet payroll obligations, leading to the abrupt furlough and termination of its entire staff. This event not only affected the employees but also eroded investor confidence.

Filed in the U.S. District Court for the Eastern District of California, the legal proceedings against Soberal and Olguin are underway. They have agreed to a partial judgment, which includes permanent injunctions and an officer and director bar. The court will determine further penalties.

In a parallel development, the U.S. Attorney’s Office for the Eastern District of California has announced criminal charges against the former CEOs. This move, supported by the FBI and the IRS Criminal Investigation, marks a serious escalation in the case.

The SEC's action against the former leaders of Bitwise Industries serves as a stark reminder of the consequences of fraudulent activities. As the investigation continues, the regulatory body remains committed to enforcing the law and protecting investors.

Source: https://www.sec.gov/news/press-release/2023-233

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