U.S. Attorney Phillip Talbert | U.S. Department of Justice
Jake Soberal and Irma Olguin, Jr., founders of the now-defunct Fresno-based company Bitwise Industries, have been sentenced to 11 and 9 years in prison, respectively. The sentencing follows their conviction for defrauding investors of approximately $115 million. U.S. Attorney Phillip A. Talbert announced the verdict.
“Defendants likened themselves to gods and joked about deceiving their well-intentioned investors while committing a massive fraud,” said U.S. Attorney Talbert. He explained that the two used fabricated bank statements, false financial information, forged documents, and fake loan collateral to secure over $100 million for a failing business venture.
IRS Criminal Investigation Oakland Field Office Assistant Special Agent in Charge Kulbir Mand commented on the broader impacts of the fraud: “The willful and egregious fraud carried out by Irma Olguin Jr. and Jake Soberal will have long-lasting impacts on not only those who invested in the well-orchestrated scam of Bitwise but also the nearly 1,000 employees and contractors who abruptly lost their jobs when the Bitwise swindlers ran out of money.”
FBI Sacramento Special Agent in Charge Sid Patel emphasized the ethical failures involved: “This case demonstrates how disastrous the impact can be when a company’s executives fail to conduct themselves ethically and lawfully.” He noted that more than 900 jobs were lost due to the scheme.
Bitwise Industries was initially lauded as a significant startup from California's Central Valley, aiming to use technology for job creation in underserved communities. Despite receiving national attention through platforms like Forbes Magazine and Ted Talks, by early 2022, Bitwise was not generating revenue.
According to court records, Olguin and Soberal misrepresented financial data repeatedly. They falsely claimed high cash balances and revenues to investors in various presentations throughout 2022 and 2023. For instance, they claimed a cash balance of over $77 million at the end of 2022 when it was less than $5 million.
Their fraudulent activities included altering audit reports and misrepresenting property ownership to secure additional funds. This pattern persisted until May 2023 when Bitwise collapsed due to lack of funds.
Both founders had professional backgrounds—Olguin as a computer engineer with prior experience running another tech company, and Soberal as an attorney specializing in intellectual property law. Their actions included hiring unqualified family members to maintain secrecy around their operations.
The investigation leading to these sentences was conducted by the FBI and IRS Criminal Investigation, with Assistant United States Attorneys Joseph Barton and Henry Z. Carbajal III prosecuting the case.
