Prosecutors move forward with $2 million SafeMoon fraud trial
Federal prosecutors will continue their case against Braden John Karony, former CEO of SafeMoon (CRYPTO:SFM), despite a Justice Department memo issued on April 7 that suggested a shift away from prosecuting digital asset cases.
In an April 18 filing, U.S. Attorney John Durham for the Eastern District of New York confirmed that his office had reviewed the new DOJ guidance but would proceed with the trial, which is set to begin with jury selection on May 5.
Karony faces charges of securities fraud conspiracy, wire fraud conspiracy, and money laundering conspiracy for allegedly diverting and misappropriating millions of dollars’ worth of SafeMoon’s SFM token between 2021 and 2022.
Karony’s legal team previously argued that the trial should be delayed, citing possible “significant changes” in digital asset enforcement under the Trump administration and referencing an executive order signed in January that called for a review of crypto regulations.
“The parties may learn within days or hours of the commencement of trial that DOJ no longer considers digital assets like SafeMoon to be ‘securities’ under the securities laws,” his lawyers stated, and warned that this could affect half of the charges against Karony.
The DOJ memo, issued by Deputy Attorney General Todd Blanche, indicated a policy of abandoning “regulation by prosecution” in crypto cases, and the SEC under acting chair Mark Uyeda has dropped several high-profile enforcement actions against crypto firms in recent months.
Prosecutors have insisted that the charges—particularly wire fraud and money laundering—are independent of SafeMoon's designation as a security, and the court rejected Karony's plea for a postponement in spite of these developments.
Karony was initially indicted in October 2023 and has pleaded not guilty to all charges.
He remains free on a $3 million bond while awaiting trial.
At the time of reporting, the SafeMoon (SFM) price was $0.00003516.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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