The Securities and Exchange Commission (SEC) has posted a note that the California court has entered judgments against former Bitwise CEOs Jake Soberal and Irma Olguin, Jr. The SEC alleged that the two former executives had misled investors about the company’s finances. Without admitting or denying the SEC’s allegations, both Soberal and Olguin have consented to the entry of the judgments.
Filed on November 9, 2023, the SEC’s complaint alleges that Soberal and Olguin made material misrepresentations and falsified documents concerning Bitwise’s cash position and historical financial performance while raising approximately $70 million from investors in 2022.
Further, the complaint claims that the two created fake bank records and an audit report that inflated cash on hand and revenue to make the company appear more appealing to investors.
The SEC claims that Bitwise faced a constant cash shortage and was often on the brink of failure because it was unable to generate sufficient funds from its operations.
Additionally, the SEC alleges that in May 2023, Soberal and Olguin failed to make payroll and then terminated its employees.
The SEC reported that the court judgments impose conduct-based injunctions as well as officer-and-director bars against both defendants and reserve the issues of disgorgement and civil penalties for further determination by the court.
