Charges and Allegations Against Bitwise Industries Co-Founders Unveiled
On Thursday, Bitwise Industries co-founders, Irma Olguin Jr and Jake Soberal, faced legal action from federal prosecutors and the Securities and Exchange Commission (SEC)., a private tech startup, accusing them of orchestrating a $100 million fraudulent scheme. Surrendering to authorities on charges of conspiracy to commit wire fraud, Olguin and Soberal were alleged to have extracted millions from various entities. Significantly, Bitwise Industries had filed for bankruptcy protection in June.
In response to the charges, attorneys for Soberal and Olguin issued a statement acknowledging their clients’ full responsibility for the mistakes that led to the downfall of Bitwise. They emphasized that, in a sincere effort to salvage the company, the co-founders had made significant errors in judgment that contributed to the unfortunate situation.
Impact on Employees and SEC’s Legal Action
The fallout from the scheme became apparent in May 2023 when the SEC exposed the fraud, resulting in the loss of jobs for hundreds of Bitwise Industries employees. Responding to these developments, the SEC filed civil charges against the co-CEOs in a federal court in California.
Regulators asserted that Soberal and Olguin misrepresented crucial information and falsified documents related to Bitwise’s financial health while raising approximately $70 million from investors in 2022. Both co-founders have consented to a bar preventing them from assuming roles as officers or directors of public companies, along with other penalties, as stipulated by the SEC.
In the event of a conviction, Soberal and Olguin could potentially face a maximum penalty of 20 years in prison and a fine of up to $250,000.
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