US legal agency accuses SafeMoon of fraud and arrests founder: SFM token “lying on the floor”

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Once a “turbulent” memecoin project during 2021-2022, SafeMoon is now facing a series of fraud charges from 4 legal agencies in the United States, and the team behind the project is also behind bars.

According to the latest announcement on November 1, U.S. federal agencies including the Federal Bureau of Investigation (FBI), Securities and Exchange Commission (SEC), Internal Revenue Service (IRS), and the District Attorney’s Office, affiliated with the U.S. Department of State’s Eastern New York Department of Justice, have issued an indictment. Charge and arrest the mastermind behind SafeMoon (SFM).

Specifically, SafeMoon’s three key leaders, including founder Kyle Nagy, CEO Braden John Karony, and CTO Thomas Smith Smith, was charged with conspiracy to commit securities fraud, conspiracy to commit wire transfer fraud and conspiracy to commit money laundering. Two of Safemoon’s three founders were arrested, Brayden John Carone and Thomas Smith, while Kyle Nagy remains “at large.”

The U.S. Department of Justice indictment charges three executive directors of Safemoon (SFM). source: Judicial Network

On the same day that the two Safemoon founders were arrested, the U.S. Securities and Exchange Commission (SEC) also filed a lawsuit against SafeMoon and its executives, accusing it of large-scale fraud that caused investors to lose billions of dollars. They are all disguised securities, and the founder’s SFM issuance activities constitute illegal securities issuance and sales.

Previously, the three defendants had lied to investors that they could not obtain locked SFM tokens, but the fact was exactly the opposite. According to the Justice Department’s charges, when the currency’s market capitalization reached the $8 billion mark, the founders sold the locked tokens for personal gain and personal expenses, misappropriating more than $200 million.

In addition, the project party also used the funds to buy back SFM in the market, thus pushing up the token price and performing other manipulation tricks. There have also been rumors in the past that SafeMoon would “inflate” the token price.

Immediately following this news, SafeMoon’s SFM token lost over 65% of its value. As of this writing, SFM is trading at around $0.00009, down nearly 40x from its ATH of $0.00338.

Current SFM Price

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