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SafeMoon CEO John Karony Claims He’s “Innocent” Of Multi-Million Crypto Fraud Scheme

Julia Smith
Last updated: | 1 min read
Cryptocurrencies scattered across a desk with a gavel, money and calculator.

SafeMoon (SFM) CEO John Karony took to X (formerly Twitter) on April 21 to defend his innocence after being charged by U.S. officials with fraud over a multi-million dollar crypto scheme last November.

“I’ll keep this post brief and to the point. I’m innocent, I didn’t commit fraud,” Karony wrote. “Looking forward to this case progressing.  I won’t be broken. I won’t be bullied.”

John Karony Denies Crypto Fraud Charges

Karony was arrested alongside SafeMoon CTO Thomas Smith last November for conspiracy to commit securities fraud, money laundering conspiracy, and conspiracy to commit wire fraud for their roles in defrauding customers of the crypto company out of millions of dollars.

SafeMoon’s founder, Kyle Nagy, was also charged but is currently at large, with crypto community members speculating that he may have left the country.

SafeMoon CEO In Legal Hot Water

In spite of Karony’s purported hopes that the case against him will move forward, the former SafeMoon CEO has encountered some legal trouble.

In January, attorneys from the law firm Petrillo Klein Boxer representing Karony withdrew their counsel, citing a lack of funds. He has since been assigned a public defender to represent his case.

Prosecutors allege Nagy, Smith, and Karony all misappropriated customer funds by stealing the money from “locked” liquidity pools, in which they assured customer assets would be safeguarded against typical rug pull schemes.

In reality, the three alleged crypto fraudsters had access to these liquidity pools to “intentionally divert and misappropriate millions of dollars’ worth of tokens” for their own personal benefit.

According to a press release from the U.S. Attorney’s Office, the SafeMoon trio used the stolen funds to purchase a “custom Porsche sports car, other luxury vehicles and real estate.”

“SafeMoon’s executives grew their company value to over $8 billion, but instead of rewarding their clients as promised, their insatiable greed led them to spend millions of dollars on their own lavish desires,”  said Ivan J. Arvelo, Special Agent in Charge of Homeland Security Investigations in New York. “Today, no luxury vehicles or sprawling real estate can protect them from the consequences of such crimes.”

Despite being on a $3 million bail, it is currently unclear when Karony is due back in court.