Utah man faces years in prison after guilty verdict in crypto fraud case #CriptoNews

SALT LAKE CITY – Attorneys for victims of a cryptocurrency fraud case are reacting after the CEO of Utah-based SafeMoon was found guilty.

Braden John Karony, 29, was found guilty on all counts last week after a 12-day jury trial in the Eastern District of New York. Karony was charged with securities fraud, money laundering, and wire fraud.

Karony, who was arrested in Provo in 2023 after charges were filed, faces up to 45 years in prison when he’s sentenced, according to prosecutors.

Braden John Karony is pictured. (Photo: LinkedIn/John Karony)

“We’re one step closer to justice for the victims,” said John Jasnoch, a San Diego-based attorney whose firm represents people who put money into SafeMoon and lost it. “It’s really a difficult thing to come out and admit that you were scammed.”

According to court documents, Karony and other executives lied about how Utah County-based SafeMoon operated, and that they diverted “millions of dollars’ worth of tokens” to buy “luxury vehicles and real estate, and to fund personal investments.”

An 8,000-square-foot house, located at 1022 W. 2200 North in Pleasant Grove, was listed in court documents as one property connected to the scheme. The home is estimated to be worth nearly $2 million, according to Zillow.

At one point, prosecutors said, SafeMoon had a market cap of more than $8 billion. Another SafeMoon executive, Thomas Smith, has already pleaded guilty and is also awaiting sentencing. A third executive, Kyle Nagy, is at large, officials said.

“Steered by his selfish desires and insatiable greed, Braden John Karony treated millions of dollars in investors’ funds as his own personal bank account,” said Darren McCormack, acting special agent in charge at Homeland Security Investigations, New York, in a statement. “The defendant will soon be trading his sprawling real estate and luxury vehicles for a jail cell within the four walls of a federal penitentiary.”

The logo for SafeMoon is pictured. (Photo: Apple App Store)

According to court documents, Karony attended Utah Valley University and LDS Business College, and he served in the Army.

Jasnoch said most people who put money into SafeMoon were not “sophisticated institutional investors.” In an interview Monday with KSL TV via Zoom, Jasnoch called what Karony and other executives did a “betrayal.”

“They really misled people about the nature of this project,” Jasnoch said, citing their “fraudulent” statements and actions. “The chickens came home to roost, and so they’ll have some time to think about what they did while they’re in jail.”

Jasnoch said he hopes to get money back for victims through a separate bankruptcy case for SafeMoon. Ultimately, though, he’s “glad to see justice prevail” with Karony’s criminal conviction, and he hopes it deters others.

“It’s not the wild west anymore,” Jasnoch said. “If you make misrepresentations and if you defraud people, you are going to get caught and you are going to go to jail.”

Karony is currently free on bond, according to the U.S. Attorney’s Office in the Eastern District of New York, but a court hearing on that issue is set to take place Tuesday morning.