67 Investors Paid $10M for NFT Tokens That Launched Worthless

The U.S. Department of Justice (DOJ) announced on Aug. 5 that Taj Tarsha, founder of the Few and Far NFT marketplace, has been indicted on securities and wire fraud charges. Prosecutors allege Tarsha raised more than $10 million from 67 investors through sales of rights to 95 million FAR tokens via Simple Agreements for Future Tokens (SAFTs), beginning in February 2022. At the time, Few and Far had no product on the market.

According to the indictment, Tarsha represented that investor funds would be used to develop the NFT marketplace and the FAR token designed to operate within it. Instead, prosecutors say he diverted money to personal wallets for online gambling, speculative cryptocurrency purchases, and other personal expenses. Court filings show funds were moved soon after receipt.

An internal audit in June 2023 uncovered the alleged misappropriation, leading to disputes over the company’s finances. Prosecutors contend that Tarsha later regained control of the treasury, fired nearly all staff, and kept one contractor to create the appearance of continued development. Personal spending continued for at least another year, including a Miami condominium loan, interior design services, an unrelated business, and Tarsha’s DJ hobby.

Tarsha launched the FAR token in May 2024, more than two years after initial investor payments. Its value has since dropped more than 99%, becoming effectively worthless and soon ceasing trading.

Deputy U.S. Attorney Sean S. Buckley stated: ‘As alleged, Taj Tarsha raised millions of dollars from investors by promising that their investments would be used to build a marketplace for non-fungible tokens, but he instead breached their trust by stealing those funds for his own personal benefit.’

Tarsha, 34, of Miami, faces one count of securities fraud and one count of wire fraud, each carrying a maximum sentence of 20 years. He was arrested on June 6. The case echoes other federal NFT fraud actions, including a $22 million rug-pull involving digital-asset projects and the Evolved Apes case where buyers were promised a video game that never materialized.

Source: https://news.bitcoin.com/featured/67-investors-paid-10m-for-nft-tokens-that-launched-worthless/