Safemoon CTO withdraws not-guilty plea, admits to $200m SafeMoon fraud

Thomas Smith, the director of technology of the cryptocurrency company, now disappeared, pleaded guilty to a compliance of securities fraud and a fraud plot in wire within the framework of a regime of several million Dollars who would have frauded investors over $ 200 million.

Recent deposit With the Federal Court of Brooklyn, Smith admitted having deceived investors about the status of the Safemoon liquidity pool, wrongly affirming that it was locked and inaccessible. Prosecutors allege, with CEO Braden John Karony and creator Kyle Nagy, diverted customer funds for personal use, thus engaging in securities fraud and wire fraud.

During his recent appearance before the court before judge Magistrate Cheryl Pollak, Smith withdrew his initial advocacy of non-win and officially pleaded guilty to the two accusations. Pollak judge has since recommended that the American district judge Eric Komitee, who oversees the case, accepts Smith’s new plea.

If it is accepted, Smith faces a maximum sentence of 20 years for a fraud conspiracy by wire and up to 25 years for the compliance of securities fraud. The decision to determine the sentence is now based with judge Komitee, who will weigh the seriousness of the offenses and the cooperation of Smith in the current investigation.

Safemoon leaders faced charges from the American Securities and Exchange commission and the Ministry of Justice in November 2023. Smith, Karonyme and Nagy were accused conspiracy, fraud and money laundering linked to the deceptive promotion and manipulation of the Safemoon token (SFM), which was classified as a security of non -recorded cryptographic assets.

According to the SEC, the team falsely marketed SFM as a secure investment, saying that its liquidity pool was locked and inaccessible to the initiates of the project. In reality, prosecutors allege that leaders have retained full access and have siphoned more than $ 200 million in investor funds.

These funds have been used for personal purposes, including luxury cars, expensive real estate and other high -end purchases.

The trio was also accused of engaging in the washing trade – a deceptive tactic where the same asset is purchased and sold simultaneously to create a deceptive market activity. With this, they were able to inflate the market capitalization of the token up to $ 8 billion at its peak, which crashed later, leaving thousands of investors with significant losses.

Smith and Karony were arrested shortly after the accusations were deposited, while Nagy remains in freedom.

Karony pleaded not guilty to all accusations and previously tried to have them rejected. His request for trial delay was recently deniedAnd opening declarations are expected to start on April 7.