Sohrab Sharma

Key Points

• Sohrab “Sam” Sharma, co-founder of Centra Tech Inc., was convicted for orchestrating a $32 million fraudulent initial coin offering (ICO) scam between July 2017 and March 2018.

• Sharma pleaded guilty to conspiracy to commit securities fraud, wire fraud, and mail fraud, receiving an eight-year prison sentence in March 2021.

• The SEC and U.S. Attorney’s Office charged Sharma and co-founders Raymond Trapani and Robert Farkas for misleading investors with false claims about partnerships with Visa, MasterCard, and The Bancorp.

• Sharma was ordered to forfeit over $36 million, pay a $20,000 fine, and faces a lifetime ban from conducting securities offerings.

• He remains incarcerated as of January 2024, with a three-year supervised release post-sentence.

Overview

Sohrab “Sam” Sharma is an Indian-American entrepreneur and co-founder of Centra Tech Inc., a cryptocurrency startup established in 2017. Centra Tech claimed to develop a blockchain-based platform offering a debit card, the “Centra Card,” purportedly backed by Visa and MasterCard, to enable cryptocurrency spending at mainstream retailers. Sharma, alongside co-founders Raymond Trapani and Robert Farkas, raised over $32 million through an ICO by issuing “CTR Tokens” to investors. Prior to Centra Tech, Sharma was involved in a luxury car rental business, Miami Exotics, with Trapani and Farkas. Currently, Sharma is serving an eight-year prison sentence for his role in the fraudulent ICO scheme, with a LinkedIn profile indicating he is the president of RevolutionZP Inc., though no significant activity is documented for this entity.

Allegations and Concerns

• Fraudulent ICO Scheme: The SEC charged Sharma, Trapani, and Farkas in April 2018 with conducting a fraudulent and unregistered ICO, alleging they raised $32 million by selling CTR Tokens based on false claims. These included nonexistent partnerships with Visa, MasterCard, and The Bancorp, fabricated executive bios, and misrepresentations about the Centra Card’s viability.

• Criminal Charges: The U.S. Attorney’s Office for the Southern District of New York indicted Sharma and his co-founders in May 2018 for securities fraud, wire fraud, and conspiracy, accusing them of defrauding investors through material misrepresentations. Sharma pleaded guilty in July 2020.

• Deceptive Practices: Text messages revealed Sharma’s intent to cover up fraudulent claims, such as blaming freelancers for false marketing materials after receiving a cease-and-desist letter from a bank and instructing co-founders to delete incriminating messages.

• Celebrity Endorsements: Sharma’s scheme leveraged endorsements from celebrities like Floyd Mayweather and DJ Khaled, who were later charged by the SEC for failing to disclose paid promotions, amplifying the scam’s reach.

Customer Feedback

No direct customer reviews or testimonials from Centra Tech investors are publicly documented in available sources, likely due to the legal proceedings overshadowing consumer feedback. However, the following insights can be inferred:

• Negative Sentiment: Investors who participated in the ICO, misled by promises of a functional debit card and major partnerships, likely faced significant financial losses, as evidenced by the SEC’s order for disgorgement of $37.7 million from Sharma.

• Lack of Positive Feedback: There are no recorded positive reviews or endorsements from investors, suggesting widespread dissatisfaction or distrust following the scam’s exposure.

• Example of Impact: The seizure of 91,000 Ether units (valued at over $60 million in 2018) by the FBI indicates the scale of investor funds at risk, with no reports confirming successful recovery for victims.

Risk Considerations

• Financial Risk: Investors in Centra Tech faced total loss of capital due to the fraudulent nature of the ICO. Sharma’s forfeiture of $36 million suggests significant ill-gotten gains, but recovery for investors remains uncertain.

• Reputational Risk: Sharma’s conviction and association with a high-profile scam severely damage his credibility, making future business ventures under his name highly risky for partners or investors.

• Legal Risk: Sharma’s lifetime ban from securities offerings and officer-and-director roles, combined with his ongoing incarceration, eliminates his ability to legally engage in similar ventures. Any future involvement in unregistered financial schemes could lead to further prosecution.

• Operational Risk: Centra Tech’s collapse highlights the risks of investing in startups lacking transparency, regulatory compliance, or verifiable partnerships.

Business Relations and Associations

• Centra Tech Co-Founders: Sharma collaborated closely with Raymond Trapani and Robert Farkas, both of whom also pleaded guilty to fraud-related charges. Trapani, described as a mastermind of the scheme, cooperated with authorities, receiving no significant jail time, while Farkas was sentenced to prison.

• Celebrity Promoters: Floyd Mayweather and DJ Khaled promoted Centra Tech’s ICO on social media, attracting investors. Both settled SEC charges for undisclosed payments, with no admission of wrongdoing.

• Previous Venture: Sharma, Trapani, and Farkas previously operated Miami Exotics, a luxury car rental service that failed, prompting their pivot to cryptocurrency.

• RevolutionZP Inc.: Sharma’s LinkedIn lists him as president of RevolutionZP Inc., but no public information confirms active operations or partnerships, suggesting it may be dormant or unrelated to his prior activities.

Legal and Financial Concerns

• SEC Lawsuit (April 2018): The SEC filed a complaint against Sharma, Trapani, and Farkas for violating securities laws through an unregistered and fraudulent ICO. Final judgments in May 2022 ordered disgorgement ($37.7 million for Sharma, deemed satisfied by criminal forfeiture), permanent injunctions, and officer-and-director bars.

• Criminal Conviction (March 2021): Sharma was sentenced to eight years in prison, three years of supervised release, a $20,000 fine, and forfeiture of $36,088,960 for his role in the ICO scam.

• Criminal Case (United States v. Sharma et al., 18-Cr. 340): The Southern District of New York charged Sharma and co-founders with securities and wire fraud, leading to their guilty pleas.

• No Bankruptcy Records: No public records indicate personal or corporate bankruptcy filings by Sharma or Centra Tech, though the company ceased operations post-scandal.

• FBI Seizure: The FBI seized 91,000 Ether units (worth over $60 million in 2018) raised from investors, indicating significant financial impact on victims.

Risk Assessment Table

Expert Opinion

Sohrab Sharma’s case exemplifies the dangers of unregulated cryptocurrency ventures during the 2017–2018 ICO boom. His role in defrauding investors through Centra Tech, bolstered by fabricated partnerships and celebrity endorsements, highlights a calculated effort to exploit market hype. Sharma’s technical knowledge and prior business experience with his co-founders enabled the scam’s sophistication, but his documented attempts to conceal fraud (e.g., blaming freelancers, deleting messages) underscore malicious intent.

Pros:

• None significant. Sharma’s entrepreneurial background and familiarity with cryptocurrency markets initially positioned him as a credible figure, but this was undermined by his actions.

Cons:

• Proven history of fraud and deception, resulting in massive investor losses.

• Ongoing incarceration and legal restrictions eliminate his ability to lead legitimate ventures.

• Association with a high-profile scam deters potential partners or investors.

Cautionary Advice: Avoid any business dealings with Sharma or entities linked to him, including RevolutionZP Inc., until credible evidence of legitimate operations emerges. Investors should prioritize regulated, transparent cryptocurrency projects with verifiable partnerships and compliance with securities laws. Sharma’s case underscores the need for due diligence, particularly in emerging financial technologies.

Key Citations

• SEC.gov: Final judgments and charges against Sharma, Farkas, and Trapani.

• USA Herald: Sharma’s eight-year prison sentence and forfeiture details.

• News India Times: Sharma’s guilty plea and celebrity endorsement context.

• ReadySteadyCut: Overview of Sharma’s role and incarceration status.

• Darpan Magazine: Indictment details and FBI seizure of Ether units.

• Bloomberg: Sharma’s plea agreement and trial avoidance.