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Shopin blockchain startup CEO pleads guilty to fraud: NY attorney general

Shopin blockchain startup CEO pleads guilty to fraud: NY attorney general

NEW YORK (Reuters) – The chief executive of Shopin, has pleaded guilty to the crime of securities fraud in connection with an estimated $42.5 million the first currency with the blockchain startup, with the office of the New York state Attorney General Letitia James announced on Thursday.

Eran Eyal, 44, of Brooklyn, also pleaded guilty to two felony counts of scheming to defraud in connection with the previous two companies, The Sync, Inc., and Springleap, Inc.

The attorney-general, said: “Eyal agreed to step down as the Shopin’ s chief executive officer, was ordered to surrender $450,000 of the cryptocurrency, in connection with, Shopin, and to pay $600,000 to the Springleap to investors, and received a three-year ban from raising capital, and serving as a director of a company in New York city.

The plea was announced a day after the U.S. Securities and Exchange Commission filed a civil fraud lawsuit accusing Eyal, a dual citizen of South Africa, and Israel, and falsely telling investors that the currency is providing, that Shopin had a close relationship with the major retailers, and an unnamed Silicon Valley entrepreneur.

A lawyer acting on behalf of Eyal, do not immediately respond on Thursday to requests for comment.

Authorities say that Eyal falsely promised Shopin the investors that their money would be going towards the creation of a “universal” shopper “profiles,” that is, it would follow that the purchases made by the customer in the online stores as well as product recommendations.

She also said that Eyal falsely told investors that the platform has been successfully tested at Bed Bath & Beyond, and Ermenegildo Zegna, and in that Shopin had been drawn up in partnership with a number of major retailers. The SEC says Eyal have revenue on personal expenses, including a dating service.

“This is the one an individual created the company after company after company continue to cheat the investors,” James said in a statement.

Eyal pleaded guilty on Wednesday before Justice Danny Chun, New York State Supreme Court in Brooklyn, according to James’ office.

Reporting by Jonathan Stempel in New York; Editing by Marguerita Choy

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