A federal jury has found former SafeMoon CEO Braden Karony guilty on all counts of conspiracy to commit securities fraud, wire fraud, and money laundering. The verdict was handed down on May 21 in the Eastern District of New York, concluding a high-profile trial that lasted 12 days.
Karony now faces a maximum sentence of 45 years behind bars, along with court-ordered forfeiture of proceeds derived from the fraudulent scheme.
Prosecutors Unveil Scheme to Mislead Investors
During the trial, prosecutors argued that Karony and other executives behind the SafeMoon cryptocurrency misled investors by falsely claiming its liquidity pools were protected by a 10% transaction tax and that developers could not access funds. Contrary to these claims, Karony and his co-conspirators retained full access and used investor money for personal enrichment.
Court filings showed that Karony and his team strategically traded SafeMoon tokens at market highs, routed proceeds through private wallets, and funneled funds into luxury goods and real estate.
Millions Spent on Luxury Cars and Homes
Prosecutors detailed that Karony personally earned over $9 million from the fraudulent scheme. The money was used to purchase a $2.2 million home in Utah, other residential properties, and luxury vehicles including multiple Audi R8s, a Tesla, and custom trucks.
One co-defendant, Thomas Smith, testified against Karony after entering a guilty plea. A third figure, SafeMoon creator Kyle Nagy, is believed to be in Russia and remains a fugitive.
Broader Impact on Crypto Industry Enforcement
Assistant U.S. Attorneys Dana Rehnquist, Sara Winik, and Jessica Weigel led the prosecution, with support from forfeiture counsel Laura Mantell.
“This case proves that cryptocurrency fraud is still fraud,” said U.S. Attorney Jaqueline Romero Nocella. “Karony misled investors and stole their money to fund a lavish lifestyle. This conviction is a warning to anyone abusing digital asset markets.”
The verdict follows recent major crypto enforcement actions, including lengthy prison terms for Celsius CEO Alex Mashinsky and FTX’s Sam Bankman-Fried. Together, these cases signal a clear shift toward aggressive prosecution of crypto-related financial crimes.
