Netflix has debuted a new crypto documentary, Bitconned. The movie begins in Miami’s decadent 2017 ICO era and ends, years later, in guilty pleas to criminal fraud. One quote from Centra founder Raymond Trapani encapsulates the storyline: “We lied, we cheated, we made millions of dollars. And now I’m facing over 100 years.”
According to friends and family members, Trapani had aspired to be a millionaire since childhood. He even had a juvenile scheme in which he acquired pharmaceuticals using a stolen pad of prescription paper. After reselling drugs on the street and earning thousands of dollars in illegal profits, police apprehended Trapani and his friends.
“It’s disappointing that he turned out to be the way he is,” said one of his former drug dealing partners.
The gaudy excesses of Miami quickly became the backdrop for Trapani’s criminal masterminding. He co-founded Miami Exotics, a doomed luxury car rental business, where he met Sam ‘Sorbee’ Sharma.
Trapani and Sorbee reportedly hated one another as children, yet grew to find each other useful as business partners. Trapani convinced his grandfather to sign for a $250,000 loan for Miami Exotics.
The business then made some $60,000 per month in profit — a promising result for Trapani and his grandfather — yet the partners continually spent more than they brought in on their lavish lifestyle. Miami Exotics ended up taking on more debt.
According to a third Miami Exotic partner called ‘Bert,’ “Sorbee robbed the company.” Other business partners blame superfluous living expenses, luxury vacations, nightlife, or shopping. In the end, Trapani lost Miami Exotic’s final $100,000 at a casino in a desperate bid to save the company, then attempted suicide by overdosing on Xanax.
Goodbye luxury car rentals, hello crypto
Sorbee introduced Trapani to crypto as a way to pivot entirely and get rich again. The pair subsequently kicked Bert out of the company and co-founded Centra.
They copied the idea of TenX, another ICO, and launched a crypto debit card called Centra Card that would be powered by a token, CTR.
By the time they had a website, whitepaper, and Slack channel ready, it was July 2017 and the ICO mania was just beginning.
Centra hired two workers from North Georgia on Upwork to steal TenX documentation and Photoshop out references to ‘TenX,’ replacing them with ‘Centra.’
It worked. Jacob Rensel, a Centra investor, thought Centra Tech had backing from Visa and Bancorp based on Photoshopped logos in Centra’s whitepaper and website.
A man allegedly named Michael Edwards with a questionable background became Centra’s CEO while Trapani appointed himself COO and Sorbee became CTO. They then appointed Robert Farkas, a former male stripper, as CFO. Farkas mostly answered questions on Slack and smiled for media interviews.
Centra duly launched its ICO and raised millions of dollars, rented an office, and hired dozens of people.
Quick to fail
Over four-fifths of ICOs were scams that have collapsed to $0. Centra Tech was one of them.
Centra’s founders tried to ship the crypto debit cards by Christmas 2017. “We literally stayed up all night every night,” said Farkas.
However, according to the documentary, Trapani did little to contribute, instead spending most of his time partying and shopping. He even stole $100,000 from a prospective ICO investor who accidentally gave him his password.
Centra went after high-profile celebrities to help plug its operation, convincing boxing star Floyd Mayweather to promote the company at the height of his career. They reportedly paid him $200,000 in cash plus $800,000 in CTR. In return, Mayweather filmed a commercial of himself using the token.
The company also persuaded DJ Khaled to endorse Centra. “Instantly, millions of dollars are coming in,” said Trapani.
New York Times starts investigating
Nathaniel Popper, a New York Times journalist and author of Digital Gold, commented on these celebrity endorsements, “It was clear that they were getting paid to do this. They have to disclose that they’re getting paid to do this.”
Of course, almost none of the celebrities disclosed their compensation. This later landed them in hot water with the Securities and Exchange Commission (SEC).
According to Popper’s research into Centra, its executives also falsified their LinkedIn accounts with non-existent degrees from Harvard University and executive positions at Wells Fargo.
Soon, Visa denied any relationship with Centra Tech and said it would force the firm to remove its logo from its website. References to Bancorp and Visa duly disappeared from Centra’s website and whitepaper.
Where is Michael Edwards?
People on Slack demanded to actually interact with CEO Michael Edwards.
Someone posted a message on Slack, “Hello. I am Michael Edwards. I’m the founder and CEO of Centra Tech… No, I’m Dr. Andrew Halayko. I’m a professor at the University of Manitoba.”
Trapani later admitted Michael Edwards was not a real person. He had used Halayko’s picture and invented the pseudonym Michael Edwards.
Incredibly, upon being discovered, Trapani then replaced Halayko’s picture with yet another fake profile: ‘William Hagner,’ this time using a picture of Trapani’s grandfather.
More journalists and YouTubers published investigations. Centra offered money to take down a critical YouTube video, which promptly got rebroadcast into Centra’s Slack. “We were paying people off all day,” Trapani said.
The end of the fraud
Popper published his New York Times article, “How Floyd Mayweather helped two young guys from Miami get rich,” while the SEC served a 500-page subpoena.
Centra executives went to their law firm, Pope and Dunn, to try to sort it out but couldn’t even find Pope’s law license. As it turned out, Pope was actually John Lambert, a college student who founded Students for Trump. “Everything was a lie,” Trapani said of him.
The end of Netflix’s Bitconned movie spirals quickly into handcuffs, courtrooms, and legal pleadings.
The SEC sued Mayweather and Khaled, who had to disgorge their compensation and pay fines, while Jacob Zowie Thomas Rensel collected information and agreed to be the lead plaintiff in a class-action lawsuit.
Trapani quit Centra Tech, did a lot of drugs, and gambled, while authorities arrested Sorbee for securities fraud.
Trapani faces a maximum sentence of 240 years in prison with charges against him including wire fraud and securities fraud. He tried to cooperate and gave information to the FBI and SEC.
The Bitconned documentary summarizes the final chapter. Authorities send Trapani to drug rehab, Sharma is sentenced to eight years in prison, Robert Farkas receives a one-year sentence, and the government seizes 100,000 ETH from Centra. To top it all off, Trapani is ordered to repay $2.9 million.
Bitconned was a familiar con
Sadly, the story of Centra is unremarkable. Indeed, there are millions of altcoins that have enriched founders at the expense of ordinary investors.
Bitconned simply filmed one example from start to finish.
Since the invention of Bitcoin 15 years ago, altcoin promoters have extracted hundreds of billions of dollars in market capitalization from failed tokens that now trade near $0.
Even in Miami, the mayor himself promoted a failed ICO, demonstrating how corruption and greed start at the top. Through Miami Coin, the mayor himself extracted millions of dollars from the now-worthless cryptocurrency.
The story of Centra is the story of crypto: garden variety fraud. And Bitconned is interesting not in spite of, but because of its predictability.