Posted on: May 23, 2025 09:45 AM

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Chief executive officer of digital asset company found guilty in multi million dollar crypto fraud scheme

At the federal courthouse in Brooklyn, a federal jury convicted Braden John Karony on all counts of a three-count indictment charging him with conspiracy to commit securities fraud, wire fraud, and money laundering.  The charges arose from the defendant’s and his co-conspirators’ roles in defrauding investors in a decentralized finance digital asset called “SafeMoon,” issued by their company SafeMoon LLC.  As alleged, the defendant agreed with his co-conspirators to lie to SafeMoon investors about whether SafeMoon executives could access the liquidity pool and whether they were using the assets from the liquidity pool for their personal benefit.  As SafeMoon’s market capitalization grew to more than $8 billion, the defendant fraudulently diverted and misappropriated millions of dollars’ worth of  liquidity from the SafeMoon liquidity pool for their personal benefit.  The verdict followed a 12-day trial before United States District Judge Eric R. Komitee.  When sentenced, Karony faces up to 45 years in prison.  The jury also issued a verdict to forfeit one residential property and the proceeds from the sale of another residential property, amounting to approximately $2 million.

Joseph Nocella, Jr., United States Attorney for the Eastern District of New York;   Christopher G. Raia, Assistant Director in Charge, Federal Bureau of Investigation, New York Field Office (FBI); Harry T. Chavis, Jr., Special Agent in Charge, Internal Revenue Service Criminal Investigation, New York (IRS-CI); and Darren B. McCormack, Acting Special Agent in Charge, Homeland Security Investigations, New York (HSI New York) announced the verdict.

“As proven at trial, the SafeMoon digital asset was anything but safe and turned out to be pie in the sky for investors who were deliberately misled by Karony, a man who sought to get rich quick by stealing and diverting millions of dollars,” stated United States Attorney Nocella.  “Karony used his scheme to purchase multiple homes, sports cars, custom trucks, and other luxury goods.  Today’s guilty verdict should serve as a warning to all would-be fraudsters that my Office will vigorously prosecute individuals like the defendant who victimize digital asset investors and undermine investor confidence in digital assets markets, thereby threatening the stability and growth of these emerging technologies.”

Mr. Nocella expressed his appreciation to the U.S. Securities and Exchange Commission for its work on the case.

“Braden Karony, the CEO of SafeMoon, exploited his company’s digital portfolio with fictional success stories and stole millions of dollars in crypto-assets to finance luxury purchases,” stated FBI Assistant Director in Charge Raia.  “Along with his co-conspirators, Karony violated his clients’ trust and wallets while attempting to conceal his misconduct through discreet transactions.  May today’s conviction emphasize the FBI’s commitment to securing all markets and protecting the American people from individuals who abuse their position to satisfy personal greed.”

“Braden Karony misled investors; intentionally diverted and misappropriated millions in cryptocurrency for his personal benefit; and lined the driveways of his million dollar homes with luxury cars.  While the name of his company is SafeMoon, there was nothing safe about this investment that was just a front for theft.  By following the money with complex cryptocurrency tracing, IRS-CI New York’s Cyber and J5 groups worked with our investigative partners to see that this conman is held accountable for his greedy acts,” stated IRS-CI New York Special Agent in Charge Chavis.  “The Joint Chiefs of Global Tax Enforcement (J5) is a global partnership that works together to gather information, share intelligence, and conduct coordinated operations against transnational financial crimes.  The J5 includes the Australian Taxation Office, the Canada Revenue Agency, the Dutch Fiscal Intelligence and Investigation Service, His Majesty’s Revenue and Customs from the U.K. and IRS-CI from the U.S.”

“Steered by his selfish desires and insatiable greed, Braden John Karony treated millions of dollars in investors’ funds as his own personal bank account,” stated HSI New York Acting Special Agent in Charge McCormack.  “The defendant will soon be trading his sprawling real estate and luxury vehicles for a jail cell within the four walls of a federal penitentiary.  As reflected by today’s conviction, whether it involves fiat or crypto, HSI New York’s El Dorado Task Force will relentlessly pursue individuals intent on exploiting investors and the American financial system for their own gain.”

From DOJ