The United States authorities have docked crypto influencer Thomas John Sfraga for 45 months for wire fraud. According to an announcement by the United States Department of Justice (DOJ), the crypto influencer TJ Stone committed wire fraud, scamming investors out of more than $1.3 million.
In the announcement, the DOJ mentioned that Sfraga, who had already pleaded guilty in May 2024, was sentenced in the Eastern District of New York. According to the authorities, TJ Stone lied to investors, posing as the owner of multiple businesses, including Vandelay Contracting Corp, a name he got from the sitcom Seinfeld. Authorities also said he presented himself as an emcee at several crypto events around New York.
Sfraga convinced investors to invest in a fake cryptocurrency called virtual wallet, promising them returns as high as 60% over the next three months after their initial deposit. Instead of using the funds for the reasons he was paid, Sfraga was said to have used some of it for personal businesses and to pay off earlier investors, making it a Ponzi-like investment scheme.
United States authorities arrest crypto influencer for fraud
Aside from the prison sentence, Sfraga has been ordered to pay about $1.3 million in forfeiture, with his restitution amount to be determined at a later date. United States Attorney John Durham mentioned that he stole from several investors including his next-door neighbors and other people he was able to convince to invest in the cryptocurrency.
“There was nothing funny about his use of a Seinfeldian company, Vandelay Industries, to carry out this fraud, which caused severe financial and emotional harm to the hard-working men and women who trusted him,” he added.
According to the court filing, Sfraga carried out his criminal activities from 2016 to 2022, lying to investors about being the owner of multiple businesses which included Building Strong Homes LLC. Authorities connected his use of Vandelay Contracting Corp to a fictional Vandelay Industries to the TV show called Seinfeld.
Authorities added that he defrauded about 17 victims, including investors from Brooklyn, Long Island, and Staten Island. Aside from his illegal crypto business, he also convinced other investors to loan him money or invest in multiple sham businesses, which he said involved purchasing, renovating, and sometimes flipping homes. The court filing noted that he convinced one of his victims to lend him $100,000 in cash to cover start-up costs on a construction project that was non-existence.
New York intensifies crypto fraud crackdown
United States authorities mentioned that they started looking into Sfraga after several investors filed complaints about him not fulfilling the end of their agreements. The lawsuit led to him fleeing to Arizona to live under a false identity. He was eventually apprehended in Las Vegas after he was arrested for running out on his bill at the Wynn Casino.
This latest conviction is part of a broader crackdown on crypto fraud in New York after United States President Donald Trump appointed John Durham as the interim United States Attorney. Other notable cases involve that of SafeMoon CEO Braden John Karony, who has requested a delay in the case because of the shift in the approach to enforcement by the current administration.
In addition, there have been some high-profile crypto personalities docked for several crimes that have explored the option of a presidential pardon. According to reports, former FTX CEO Sam Bankman-Fried has explored the option while still serving his 25-year jail term. Another personality is former Binance CEO Changpeng Zhao, who completed a four-month jail term in 2024, but Zhao has denied any interest in a pardon.
The recent crypto personality vying for a presidential pardon is Roger Ver nicknamed Bitcoin Jesus, who is currently facing a life sentence for tax evasion and mail fraud. Several influential crypto personalities have spoken up for Ver, urging President Trump to grant him a pardon, with Ethereum co-founder Vitalik Buterin campaigning for him. The crypto community is still divided over the issue, with some seeing the case as the same with previously pardoned Ross Ulbricht, while others say he has to face the consequences of his actions.
Cryptopolitan Academy: Coming Soon – A New Way to Earn Passive Income with DeFi in 2025. Learn More
This articles is written by : Nermeen Nabil Khear Abdelmalak
All rights reserved to : USAGOLDMIES . www.usagoldmines.com
You can Enjoy surfing our website categories and read more content in many fields you may like .
Why USAGoldMines ?
USAGoldMines is a comprehensive website offering the latest in financial, crypto, and technical news. With specialized sections for each category, it provides readers with up-to-date market insights, investment trends, and technological advancements, making it a valuable resource for investors and enthusiasts in the fast-paced financial world.
By Nermeen Nabil Khear 