Photo credit: Federal Bureau of PrisonsSAN BERNARDINO COUNTY – Bitwise Industries co-founder Irma Olguin Jr. reported to a federal prison in Victorville, March 18, after pleading guilty to wire fraud. Olguin will serve nine years.
Federal prosecutors say Olguin and cofounder Jake Soberal worked together to defraud investors and lenders out of millions of dollars before the scheme collapsed in May 2023.
Soberal was sentenced to 11 years in prison and is in custody at the United States Penitentiary (USP) Atwater in Merced County.
In addition to jail time, Olguin and Soberal have to pay back almost $115 million to investors.
Faked financial documents even though only a few thousand in bank
The Fresno-based startup, founded 2013, had a mission to turn old buildings into tech hubs where people from underserved communities could learn tech skills.
“Olguin, Jr. and Soberal received national media attention by appearing in publications like Forbes Magazine and giving Ted Talks where they portrayed Bitwise as being a success,” said the Department of Justice (DOJ) in a news release.
However, according to prosecutors Olguin and Soberal lied and faked financial documents to make it look like the company had millions of dollars, even though it only had a few thousand in the bank.
For example, the DOJ said in June and July 2022, Olguin and Soberal falsely represented to a California-based investment firm that Bitwise had secured a $150,000,000 investment from another, London-based investment firm.
This was done to convince the California-based investment firm to purchase several buildings that Bitwise owned.
The DOJ said almost 1,000 employees and contractors lost their jobs when Bitwise ran out of money.
Olguin said sorry for taking money
During Soberal’s comments in front of the judge, he said he was motivated to lie, in part, because he was driven by the demand to make sure employees got paid.
Olguin said she was sorry for taking the investor’s money and betraying their trust.
