A federal jury in Brooklyn has found Braden John Karony guilty on all counts of a three-count indictment, which includes conspiracy to commit securities fraud, wire fraud, and money laundering. The charges are related to his involvement in defrauding investors through the decentralized finance digital asset "SafeMoon," issued by SafeMoon LLC. The verdict came after a 12-day trial presided over by United States District Judge Eric R. Komitee.
The prosecution alleged that Karony and his co-conspirators misled investors about their access to the SafeMoon liquidity pool and used funds for personal gain. As SafeMoon's market capitalization exceeded $8 billion, they allegedly diverted millions from the liquidity pool. Karony now faces up to 45 years in prison upon sentencing.
Joseph Nocella, Jr., United States Attorney for the Eastern District of New York, commented on the case: “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.” He added that this verdict should serve as a warning against fraudulent activities targeting digital asset investors.
FBI Assistant Director Christopher G. Raia stated: “Braden Karony exploited his company’s digital portfolio with fictional success stories and stole millions of dollars in crypto-assets.” IRS-CI New York Special Agent Harry T. Chavis emphasized that tracing cryptocurrency transactions helped hold Karony accountable for his actions.
Darren B. McCormack from Homeland Security Investigations remarked: “Steered by his selfish desires and insatiable greed, Braden John Karony treated millions of dollars in investors’ funds as his own personal bank account.”
Karony's fraudulent scheme involved misrepresenting key aspects of SafeMoon's offering, such as claiming that liquidity pools were locked and would automatically grow due to transaction taxes. In reality, he retained access to these pools and profited personally from trading activities.
Co-conspirator Thomas Smith has pleaded guilty and awaits sentencing while Kyle Nagy remains at large. The case is being prosecuted by Assistant United States Attorneys Dana Rehnquist, Sara K. Winik, Jessica K. Weigel, with support from Paralegal Specialists Asher Martin-Rosenthal and Madison Bates.
