The Securities and Exchange Commission on Tuesday obtained a court order halting an ongoing fraud involving an initial coin offering scheme that raised as much as $21 million by orchestrating a social media campaign based on false corporate relationships and false testimonials with the Federal Reserve, PayPal, Verizon, Boeing and The Walt Disney Co.
The court also approved an emergency asset freeze and the appointment of a receiver for Titanium Blockchain Infrastructure Services Inc., the firm behind the alleged scheme.
According to the SEC complaint unsealed Tuesday, Titanium President Michael Alan Stollery, aka Michael Stollaire, a self-described “blockchain evangelist,” lied about business relationships with the Federal Reserve and dozens of well-known firms, including PayPal, Verizon, Boeing, and The Walt Disney Company.
The complaint alleges that Titanium’s website contained fabricated testimonials from corporate customers and that Stollaire publicly — and fraudulently — claimed to have relationships with numerous corporate clients.
The complaint alleges that Stollaire promoted the ICO through videos and social media and compared it to investing in “Intel or Google.”
Between late November 2017 through at least Jan. 25, 2018, the defendants “succeeded in raising as much as $21 million in the form of various digital assets, such as Ether and Bitcoin, and cash from dozens of investors located in at least 18 states, including California, and abroad,” the complaint states, who purchased the digital asset in the scheme dubbed “BAR.”