US Justice Dept Arrests Blockchain Company Official on Charges He Defrauded Firm of More Than $1M
The Justice Department has accused Rikesh Thapa of defrauding his startup tech firm of more than $1 million in U.S. currency, cryptocurrency and utility tokens, according to a press release on Wednesday.
The 28-year-old Thapa was arrested on Wednesday in California and is expected to come before a federal judge for the Southern District of California.
The Justice Department did not name the victim company, but it appears to be New York City-based Blockparty, a company that developed a blockchain-based protocol for live event tickets. Thapa’s LinkedIn profile lists himself as a founder and chief technology for Blockparty from October 2017 to December 2019. (The indictment lists him as co-founder.) He lists his current positions as CEO of crypto firm BitOverflow, co-founder of renewable energy firm VerdeBlocks and co-founder of grocery delivery service Bazaar.
According to the indictment, in 2018, Thapa agreed to receive and hold $1 million of his company’s money in his personal bank account while the firm explored other banking options. Thapa soon began using the funds on personal expenses such as nightclubs, travel and clothing, despite re-assuring the company that he was only holding the money “for safekeeping.”
Thapa even falsified bank statements to conceal his theft, and in 2019, he refused to return the $1 million, according to the indictment.
The San Diego native is also accused of embezzling at least 10 bitcoin from his company, as well as stealing its utility tokens.
Thapa is being charged with one count of wire fraud, which carries a maximum sentence of 20 year in prison.
UPDATE (Dec. 7, 17:33 UTC): Added details on Thapa's current listed positions on LinkedIn.