LOS ANGELES (CNS) – A Reseda man is facing a federal charge for his alleged role in a $21 million cryptocurrency fraud scheme that prosecutors say used fake business relationships with Apple Inc., Pfizer Inc. and The Walt Disney Company to create the appearance of legitimacy, the Department of Justice announced Thursday.
Michael Stollery, 54 — the CEO and founder of Titanium Blockchain Infrastructure Services, a purported cryptocurrency investment platform, was charged in L.A. federal court with one count of securities fraud, the DOJ said.
The alleged scheme involved TBIS’ initial coin offering, which raised $21 million from investors in the United States and overseas.
Prosecutors contend that in order to lure investors, Stollery 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 U.S. 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,” said Kristi Johnson, assistant director in charge of the FBI’s Los Angeles Field Office.
“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.”
If convicted as charged, Stollery would face up to 20 years in prison, the DOJ noted.