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SafeMoon CEO Braden John Karony will go to trial over a US$200 million fraud case. It was confirmed by New York prosecutors. The decision comes despite a recently released US Department of Justice (DOJ) memo that advises prosecutors to ease off certain crypto-related cases.
The memo was issued on April 7, 2025, by Deputy Attorney General Todd Blanche. It suggested backing away from cases that seem like “regulation by persecution.” However, in a court filing on April 18, Attorney General John Durham made it clear his office will not drop the charges against Karony. He said the case still holds up under the new DOJ policy and deserves to proceed in court.
Karony was charged in November 2023, together with SafeMoon executives, Kyle Nagy and Thomas Smith. The charges were levied for running a US$200 million crypto scam scheme. Prosecutors say they deceived investors regarding the safety of the locked liquidity feature of the SafeMoon (SFM) token while diverting money for personal use.
The US Securities and Exchange Commission (SEC) has also filed a parallel civil suit. The suit accuses the trio of market manipulation after SFM's value dropped during investor panic.
Karony has been charged with several counts, including conspiracy to commit securities fraud, wire fraud, and money laundering. Up to 20 years in prison is possible for each count of wire fraud or money laundering. Securities fraud, on the other hand, is punishable by five years. Conviction on all counts would send him more than 40 years behind bars. Co-defendant Thomas Smith has been taken into custody. Kyle Nagy is still at large.
Karony first posted a US$3 million bond under the guidance of law firm Petrillo Klein & Boxer. The firm, however, has since withdrawn from the case after failing to get paid for its legal fees. Now, Karony will be defended by a court-appointed lawyer under the Criminal Justice Act.
As the legal troubles for the CEO continue to mount, it remains to be seen if he will end up in jail or come out victorious.
