FRESNO, Calif. — Irma Olguin Jr. and Jake Soberal, the founders and leaders of the failed Fresno-based technology company Bitwise Industries, self-surrendered today on a federal complaint charging them with conspiring to commit wire fraud and taking more than $100 million from various businesses and individuals, U.S. Attorney Phillip A. Talbert announced.
“The defendants could have chosen simply to admit the failure of Bitwise’s business model. Instead, they used lie after lie to pull over $100 million into a dying venture through fraud,” U.S. Attorney Talbert said. “Olguin and Soberal fabricated bank statements, lied to investors, provided false financial information to their board of directors, forged documents, and used buildings Bitwise no longer even owned as collateral for loans, all while lining their own pockets. Our office will continue to investigate and prosecute those responsible for such financial crimes, and we are grateful for the hard work of the FBI and IRS Criminal Investigation, as well as the civil enforcement work of the United States Securities and Exchange Commission.”
“The alleged deceptive business practices of Mr. Soberal and Ms. Olguin Jr. have directly and negatively impacted over 900 families from the Fresno and Bakersfield communities. Today’s complaint is a starting point toward justice for those families,” said IRS Criminal Investigation Acting Special Agent in Charge Mark Silva of the Oakland Field Office. “These sorts of white-collar crimes often root from greed and mismanagement and leave hard working tax paying citizens damaged in their wake. Let me say this to any would be fraudulent business owners in pursuit of ill-gotten proceeds: The talented and motivated special agents from IRS Criminal Investigation and our law enforcement partners from the FBI will catch you.”
“Deceptive practices within the corporate world, as alleged in this case, have far-reaching consequences. Our dedicated team of special agents and professional staff worked tirelessly to uncover a complex web of misconduct,” stated Special Agent in Charge Sean Ragan of the FBI Sacramento Field Office. “We value our strong partnerships with the U.S. Attorney’s Office and the IRS Criminal Investigation. Together, we are resolute in our commitment to upholding justice, ensuring transparency, and breaking the cycle of financial wrongdoing. The collaboration between our team and our partners underscores the importance of holding wrongdoers accountable, reinforcing ethical leadership, and empowering individuals to report misconduct. It is through these efforts that we aim to make a meaningful difference in the fight against financial crimes.”
According to court records, Bitwise abruptly collapsed earlier this year despite recent reports the company was worth over $500 million and was financially sound. All of the company’s approximately 900 employees and apprentices were immediately furloughed and later laid off, and the company’s board of directors fired Olguin and Soberal.
The complaint filed this week alleges that beginning no later than January 2022, Olguin and Soberal agreed to lie to board members, investors, lenders, and others about Bitwise’s finances to obtain investments, loans, and other funding. They did so by fabricating financial information in board presentations and investor materials, and altering and forging bank statements, audits, and other financial records to inflate Bitwise’s revenues, cash balances, and property holdings. Much of the money went towards paying Bitwise’s payroll and fringe benefits, including Olguin and Soberal’s $600,000 per year salaries, outfitting the company’s office spaces, and repaying debts owed to prior lenders.
This case is the product of an investigation by the Federal Bureau of Investigation and the Internal Revenue Service, Criminal Investigation. Assistant U.S. Attorneys Joseph D. Barton and Henry Z. Carbajal III are prosecuting the case.
If convicted, Olguin and Soberal each face a maximum statutory penalty of 20 years in prison and a $250,000 fine. Any sentence, however, would be determined at the discretion of the court after consideration of applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations and the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.