Michael Stollery, the CEO of Titanium Blockchain, has been sentenced to four years in prison for his involvement in a cryptocurrency fraud scheme that stripped investors of $21 million in an initial coin offering (ICO) for Titanium Blockchain structure Services (TBIS). Stollery was accused of not registering the ICO with the regulator, among other allegations. In July 2022, he pleaded guilty to one count of securities fraud for his part in the scheme. He admitted to falsifying aspects of TBIS’ whitepapers, planting fake customer witnesses on the TBIS website, and incorporating ICO investors’ finances with his own, using a portion to pay for unconnected charges like credit card bills and bills for his Hawaii condominium.
While Stollery faced up to 20 years in prison, he will serve an aggregate of four years and three months for his involvement. The Securities and Exchange Commission (SEC) has been increasing conduct against the cryptocurrency space in recent times. The number of cryptocurrency-related actions brought by the SEC grew in 2022 with 30 enforcement conduct against digital-asset request actors in the time, over 50 from the 20 conducted in 2021. Of the 30 total enforcement conduct in 2022, 14 involved ICOs, with more than half of these including a fraud allegation.