The tech community in Fresno has been rocked by the stunning revelation that Bitwise Industries co-founders Irma Olguin Jr. and Jake Soberal have been arrested. They face allegations of executing a fraudulent scheme that swindled investors from a staggering $100 million. The United States Attorney’s office, under Phillip Talbert, has accused the duo of a series of deceptive financial practices.
Moreover, the indictment details a troubling scenario. Olguin Jr. and Soberal are accused of fabricating bank statements and providing investors and their own board with false financial information. They allegedly used properties as loan collateral without proper disclosures. Additionally, the substantial salaries drawn by the co-founders have come under scrutiny amidst the company’s financial turmoil.
The charges come on the heels of Bitwise furloughing 900 employees, causing significant disruption in its operations. Consequently, this has put a halt to the company’s ambitious projects meant to open doors in the tech industry for underserved communities.
Furthermore, the Securities and Exchange Commission (SEC) has leveled its own charges against the Bitwise executives. They claim the company, under the guidance of Olguin Jr. and Soberal, grossly misrepresented its financial health to investors, raising $70 million based on these purportedly falsified credentials.
The SEC’s investigation paints a grim picture of a company on the edge of collapse despite public projections of growth and stability. The SEC points out an alleged deceit where the founders reportedly inflated bank account balances in communications to investors.
Amid these charges, Bitwise has actively engaged in the exchange-traded fund (ETF) market. The company has notably amended its application for a spot Bitcoin ETF, aiming to offer investors regulated exposure to Ethereum and Bitcoin futures.