LOS ANGELES (CNS) – A Reseda man faces up to 20 years behind bars when he is sentenced Nov. 18 for his role in a $21 million cryptocurrency fraud scheme that used fake business relationships with Apple Inc., Pfizer Inc. and The Walt Disney Company to create the appearance of legitimacy.
Michael Stollery, 54 — the CEO and founder of Titanium Blockchain Infrastructure Services (TBIS), a purported cryptocurrency investment platform — pleaded guilty Friday in Los Angeles to one federal count of securities fraud, according to the US Department of Justice.
The scheme involved TBIS’ initial coin offering, which raised $21 million from investors in the United States and overseas.
Stollery admitted that in order to lure investors, he falsified TBIS white papers — documents for prospective investors that typically explain how the technology underlying the cryptocurrency works and the purpose of the cryptocurrency project — planted fake testimonials on TBIS’ website and fabricated purported business relationships with the US Federal Reserve Board and dozens of prominent companies to create the appearance of legitimacy.
“Mr. Stollery convinced victims to invest by deceiving them with calculated lies about the profit potential and by artfully creating an illusion that he was well-connected and a proven success,” Kristi Johnson, assistant director in charge of the FBI’s Los Angeles Field Office, said when the defendant was charged in June.
“While cryptocurrency investments can be alluring to those seeking the latest opportunity, caution is warranted as the fraud associated with decentralized money investments is pervasive.”