Crypto Scams: Centra Tech ICO

When the likes of Floyd Mayweather and DJ Khaled back a crypto project, it is definitely worth investing in, right?


The Centra Tech ICO was nothing but a scam, pretending to be the golden boy of crypto. Maybe the celebrities were a part of the con – or maybe they were conned themselves. In any case, one thing is clear; big promises and loud endorsements are not enough to make a successful coin.

It needs to be actually doing something useful.

The Marketing Blitzkrieg

In the summer of 2017, talk of a new crypto started spreading through the cryptocurrency community. The coin was Centra, and the ones talking were Floyd Mayweather and DJ Khaled. Naturally, people began to sit up and take notice.

What completely ‘nailed it’, for most people, were the actual photographs of the celebrities posing with the Centra crypto cards. Apparently, the fledgling cryptocurrency had already entered into partnerships with both MasterCard and Visa.

Talk about tall promises.

The claim was that the card would allow users to spend their crypto easily on any Visa or MasterCard enabled merchant. Which of course, means everywhere. No need to go through a long drawn process on Coinbase to convert your digital assets to fiat. No more waiting for that hip cafe to start supporting Bitcoin. Centra Tech was promising to significantly enhance the utility of every cryptocurrency.

“Call me Floyd ‘Crypto’ Mayweather now”

Indeed, in a pic tweeted by the famous boxer, he could be seen holding what appeared to be the Centra card itself. The accompanying text confirms this by stating, “Spending bitcoins ethereum and other types of cryptocurrency in Beverly Hill….”.

And this wasn’t the first time this pic appeared. Throughout the month, the photograph was posted repeatedly on every social channel of Floyd ‘Money’ Mayweather. Be it Facebook, Instagram or Twitter, posts actively supporting the Centra Tech ICO kept making an appearance.

“This is a Game Changer here.” – DJ Khaled

Mayweather wasn’t the only big name participating in the promotion of this fake coin. DJ Khaled, the famed record producer and radio personality, was also roped in by the scam.

Khaled could also be seen on his social media channels holding the mythical Centra Card. He also goes on to encourage his followers to buy Centra’s CTR tokens for good measure.

This blatant shilling of the Centra Tech ICO sounded the alarm for many people. The comments section of these now deleted posts were full of posts questioning the projects authenticity and the celebrities’ motives. But there are always those who fall for the lie.

The Initial (Scam) Coin Offering

The Token sale of the ‘game changer’ went live on 19th September 2017. It lasted for exactly a week, giving ample time for gullible investors to be tricked by the scam. Our crypto enthusiastic boxer Floyd Mayweather was there waiting to funnel investors into the trap.

All of a sudden Floyd wasn’t interested in talking about boxing. Instead, it was all about the Centra Tech ICO.

Straightaway,  this viral post drew upon his fame and medals to persuade people to buy Centra’s token. In a since-deleted Facebook post, he gets even more direct, saying that “As usual I’m going to win big with this one!”

Needless to say, the ICO was a resounding success. By the time the ICO has shut its doors, the Ponzi scheme had made a whopping $32 million.

Unraveling the Plot

After the wildly successful token sale, there was a surge of interest in the people behind this wonderful new product. Skeptics openly doubted the ability of the company to deliver, and started to ask tough questions.

But Sorhab Sharma, Raymond Trapani, and Robert Farkas, the three co-founders of Centra Tech, had covered their tracks as well. Their website was filled with impressive track records of the executives in charge of the project. It listed their previous positions and boasted of their “decades of industry experience” to reassure investors of their legitimacy.

Furthermore, the three claimed to have been granted money transmitter licenses in 38 US states. This silenced many of the doubters.

However, their fame had grown a trifle too great to handle.

Two months after the ICO has held, the company was sent a cease-and-desist letter from none other than Visa, who completely denied any partnership with the company. MasterCard decided to chime in too and also denied of being a part of any deal with Centra Tech. Needless to say, the days of Centra Tech were numbered.

Meanwhile, many dedicated individuals had attempted to verify the credentials of the Centra Tech executives, and had come to a shocking conclusion: no such executives existed. The profiles and bios were all made up.

And the two celebrities, it turned out, were complicit in the scheme, having been paid for endorsing and supporting the ICO. Trapani even claimed that the two were not just advertisers, but official brand ambassadors and managing partners of the firm.

The Crackdown

By now, the investors were panicking. Many attempted to reach out to the company, asking for a refund. But their efforts were met with a stony wall of silence.

The website had shut down, the official social media had been scrubbed clean, and the founders nowhere to be found. It was clear that the thieves had closed up shop for good.

There was nothing that the defrauded investors could really do, and it seemed that this incident would go down the same way as the dozens of other false ICOs that had fooled cryptocurrency investors. But then, the SEC stepped in.

Enter the Watchdog

The US Securities and Exchange Commission (SEC) is the main authority for regulating investment markets. While cryptocurrencies are not yet regulated or part of the traditional stock market, they are certainly an instrument for investment. That means they are still subject to the rules laid down by the commission.

Which, it turned out, was a very good thing.

While most of the crypto related scams are usually pulled off in developing Asian countries with less than a robust regulatory system (example: Pincoin), Centra had mostly targeted Americans and had unwittingly drawn more attention than they could handle.

As a result, the commission took note of their fraudulent actions, and moved to act against them. A criminal case was filed in the Southern District of New York, charging the three founders with misrepresenting facts and “orchestrating a fraudulent initial coin offering (ICO).”

The police jumped into action, arresting the masterminds of the ponzi scheme before they could leave the country. Even so, it was a close shave; Farkas was apprehended whilst he was about to board a flight taking him out of the country.


While the SEC filing failed to mention Floyd Mayweather or DJ Khaled, a separate class action lawsuit has been filed against the two celebrities for their involvement in the scam. The cheated investors are suing the two endorsers of the Centra Tech ICO for fraud, and demanding a complete refund of their investments, in addition to damages for breach of faith.

Will they ever get their money back?

Well, it’s complicated.

You see, it isn’t like there aren’t any assets to repay the investors with. When the Federal Bureau of Investigation swooped down upon the masterminds of the scam, they recovered around 91,000 ETH coins from them.

At that time, Ethereum was still going strong, and the hoard amounted to a little over $67 million. Yes, you read that right, $67 million. Enough to pay the outstanding liability of $32 million two times over and yet have a couple of million to spare.

Well, that’s not the case anymore. As usually happens in the crypto world (the Mt Gox saga comes to mind), the price of the cryptocurrency tanked while the case was still being fought. After getting battered through the bear market of this year, the recovered assets are now valued at just $18 million.

So that’s a… Yes?

Still, investors would appreciate having part of their hard earned money back. The sooner the better. However, if the market signs are anything to go by, this treasure trove will be reduced to a pittance while the case drags on.

Yet the converse is true as well: it might be that the price actually shoots up, in which case the disgruntled investors actually stand to profit from the whole thing.

As for the lawsuit against the celebrities, it is hardly likely to come to anything. Already the two are distancing themselves from their earlier statements, removing the incriminating posts from social media. If the issue comes up in court, they can easily claim ignorance of the real nature of the scheme. So we are unlikely to see significant penalties (financial or otherwise) slapped on Floyd Mayweather or DJ Khaled.

That being said, most investors would be glad to get even some of their money back from the scam. All eyes are now on the SEC, as it moves to wrap up the process of convicting the criminals and release the funds to the defrauded public.


Initial Coin Offerings are a proverbial minefield. While there are some treasures to be found there, many are siren calls that attempt to trap unsuspecting investor and drain them of their money.

Do not be lured by big promises or unbelievable claims. Always do your own due diligence on a project before taking action. Sometimes, it may be hard to work out fact from fiction, so stick to reputable sites that you can trust and always question the information you are given.

Finally, never let a celebrity influence your choices. Whilst on the surface it may appear to lend credibility to the project, all that it actually means is that the founders had the means to spend big on marketing.

Even though the Centra Tech incident might have a happy ending, not all scams end up this way. Many operate from countries lacking a robust legal system and hide behind a screen of shady companies and phony profiles to evade capture.

The crypto ICO market is a largely uncharted territory; dangerous, deceptive, and occasionally rewarding.

Watch out.

Further Reading At
1) Never Heard Of Mt GOX? Find Out About The Scam That Nearly Brought Crypto To Its Knees.

2) Avoiding ICOs And Looking Undervalued Cryptos? Our Top Picks For 2019 Will Give You Food For Thought.

3) Which Under The Radar Crypto Projects Should Be On Your Watchlist? We Reveal Our Top Choices.


DISCLAIMER: Be aware that the activity of cryptoassets mentioned in this article is unregulated. This article must not be construed as investment advice. Always do your own research.

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