Former Bitwise co-CEOs Jake Soberal and Irma Olguin Jr. changed their plea to guilty in federal court on Wednesday in the $115 million fraud case.
After formalizing the plea deal, the duo will return to court on Nov. 6 for their sentencing.
The backstory: Soberal and Olguin initially pleaded not guilty last November to defrauding investors of $115 million.
- But there were signs along the way that they were open to dealing with the federal government – notably their deal last year with the U.S. Securities and Exchange Commission to bring a quick resolution to charges that they misled investors.
The big picture: Appearing in front of Judge Dale Drozd, Soberal and Olguin pleaded guilty to one count of conspiracy to commit wire fraud and one count of wire fraud.
- They also agreed in the plea deal to pay restitution to the victims not exceeding $115 million.
- Soberal and Olguin are also required to forfeit all property that they purchased with proceeds from the fraud.
State of play: Soberal and Olguin answered a litany of questions from Drozd regarding the plea deal before making the guilty plea official.
- Soberal told Drozd that he has been consulting for local nonprofits since Bitwise collapsed in May 2023.
- Olguin said she has been working as a freelancer but did not provide any specifics.
What we’re watching: While the maximum penalty for their charges is 20 years in prison each with a fine of $250,000, they will likely not spend decades behind bars.
- Per the plea deal, federal prosecutors will recommend that Soberal and Olguin be sentenced to the low-end of the applicable guideline range determined by the court.
- Soberal and Olguin have agreed to not request less than five years in prison.
- It has not yet been determined which judge will sentence them in November.
