US authorities docked cryptography influencer Thomas John Sphraga for 45 months for wire fraud. Cryptofluencer TJ Stone committed wire fraud and fraudulent investors over $1.3 million, according to a U.S. Department of Justice (DOJ).
In the announcement, the DOJ said Sfraga, who had already pleaded guilty in May 2024, was sentenced in the Eastern District of New York. Authorities said TJ Stone lies to investors and pretended to be the owner of multiple businesses, including Vandelay Contracting Corp, which he learned from Seinfeld. Authorities also said he presented himself as a host at several crypto events around New York.
SFRAGA has convinced investors to invest in fake cryptocurrencies called virtual wallets, and has promised that they will be as high as 60% over the next three months from their first deposit. Instead of using the funds for reasons he was paid, Sfraga is said to have used some of it to pay back personal businesses and former investors, resulting in an investment scheme like Ponzi.
US authorities arrest crypto influencers for fraud
Apart from prison, Sfraga has been ordered to pay the forfeiture of about $1.3 million, and his compensation amount will be decided at a later date. US lawyer John Durham said he stole it from several investors, including neighbors and others who could convince him of investing in cryptocurrency.
“There was nothing interesting about the use of Vandelay Industries, the company of Seinfeldian, to carry out this scam.
According to court filings, SFRAGA has committed criminal acts from 2016 to 2022 and is lying to investors about being the owner of multiple businesses, including the construction of Strong Homes LLC. Authorities tied the use of Vandelay Contracting Corp to the fictional Vandelay Industries to a television program called Seinfeld.
Authorities added that they have scamped around 17 victims, including investors in Brooklyn, Long Island and Staten Island. Aside from his illegal crypto business, he has persuaded other investors to lend him money or invest in multiple fake businesses. The court filing pointed to the persuasion of one of his victims to lend him $100,000 in cash to cover the launch costs of a non-existent construction project.
New York strengthens oppression of crypto fraud
US officials said they began looking into SFRAGA after several investors filed complaints that they did not meet the termination of his contract. The lawsuit led him to flee to Arizona and living under a false identity. He was eventually arrested in Las Vegas after being arrested for a lack of bills at Win Casino.
This latest conviction is part of a wider crackdown on crypto fraud in New York after President Donald Trump appointed John Durham as interim US lawyer. Other notable cases include the case of Safemoon CEO Braden John Karony. Braden John Karony has called for delays in the case due to changes in the current administration’s approach to enforcement.
Additionally, several famous code personalities have been docked for some crimes that explored the president’s amnesty options. Reports say former FTX CEO Sam Bankman-Fried looked into options while serving a 25-year prison sentence. Another character is Changpeng Zhao, a former CEO of Vinance who completed a four-month sentence in 2024, but Zhao has denied interest in pardoning.
The recent nature of the code, which has been fighting for presidential pardons, is that Roger Ver is called Bitcoin Yes. Several influential cryptic personalities have spoken for Ver, urging President Trump to give him pardon, with Ethereum co-founder Vitalik Buterin campaigning for him. The crypto community is still divided into this issue, with some people being considered the same as previously forgiven Ross Ulbricht, while others say he must face the consequences of his actions.
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