YEREVAN (CoinChapter.com) — Thomas Smith, the Chief Technology Officer of SafeMoon LLC, has pleaded guilty in connection with a crypto fraud involving over $200 million. Smith changed his plea from not guilty to guilty on Feb. 20 at a federal court in Brooklyn. Magistrate Judge Cheryl Pollak presided over the hearing.
Judge Pollak recommended to U.S. District Judge Eric Komitee to accept Smith’s new guilty plea. Smith pleaded guilty to charges of securities fraud conspiracy and wire fraud conspiracy.
SafeMoon CTO Thomas Smith Withdraws Not Guilty Plea and Admits Guilt in $200M Crypto Fraud Case. Source: PACERPotential Prison Sentences for Smith
The charges against Smith carry heavy penalties. The wire fraud conspiracy charge has a maximum prison sentence of 20 years, while the securities fraud conspiracy charge has a maximum of 25 years in prison.
Court documents have recorded Smith’s guilty plea, marking a key development in the case against SafeMoon’s executives.
Charges Against SafeMoon Executives
In November 2023, the U.S. Justice Department and the Securities and Exchange Commission (SEC) filed charges against Smith, SafeMoon CEO Braden John Karony, and token creator Kyle Nagy.
These executives allegedly promoted a cryptocurrency token called SafeMoon (SFM). They told investors the liquidity pool was locked and inaccessible. Prosecutors allege the executives accessed and used these funds personally.
Executives Allegedly Took $200 Million
The SEC and prosecutors state that Smith, Karony, and Nagy took over $200 million from the SFM token liquidity and spent it on luxury vehicles and real estate.
SafeMoon (SFM) reached a market cap between $5.7 billion and $8 billion at its peak. However, its value fell by nearly half on April 20, 2021, after reports revealed that the liquidity pool was not locked.
Status of SafeMoon Executives
CEO Braden John Karony continues to plead not guilty. Karony also attempted to dismiss the charges in April last year. Earlier this month, Karony requested a delay in his trial, mentioning potential crypto policy changes promised by former U.S. President Donald Trump.
Notably, Judge Komitee rejected Karony’s request. Karony’s trial is set to begin on April 7, with opening statements expected to outline the charges against him.
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