ATLANTA, Ga. (WJBF) – According to the Federal Bureau of Investigation (FBI), Atlanta film producer Ryan Felton will be facing sentencing in the U.S. Federal Court after pleading guilty to multiple counts of wire fraud, securities fraud, and money laundering charges.
Authorities say the charges come from Felton’s fraudulent promotion of two cryptocurrency investment schemes that cost investors millions in losses.
According to investigators, Felton promoted an initial coin offering (ICO) for a new entertainment streaming platform, FLiK, which he promised would surpass Netflix in 2017.
Authorities say to increase the price of FLiK coins, Felton falsely represented to investors that a prominent Atlanta rapper and actor was a co-owner of FLiK, the United States military had agreed to distribute the streaming platform to service members, and FLiK was finalizing licensing deals with major film and television studios.
Investigators also state that Felton claimed that he was actively developing the platform and would use all funds raised in the ICO to launch FLiK; however, after the ICO closed, Felton dumped more than 40 million FLiK coins on trading markets, causing the value of FLiK coins to plummet.
According to authorities, Felton promoted a second ICO for a new company, CoinSpark, which was a cryptocurrency trading exchange in 2018.
Investigators say that in order to attract investors to the ICO, Felton promised that Spark coin investors would receive 25% of the trading exchange’s profits in the form of dividends.
Authorities state that after raising more than $200,000 in the ICO, Felton announced that CoinSpark would not pay Spark investors a dividend and offered ICO investors a refund, and then, Felton repeatedly rejected or ignored investor requests for refunds.
According to investigators, the CoinSpark exchange ultimately launched months after its promised delivery date but had significant technical issues and minimal trading activity, and instead of applying ICO proceeds to FLiK and CoinSpark, Felton diverted significant funds to his personal bank account.
FBI Atlanta says they are now looking for potential victims in this case prior to sentencing.