67 Investors Paid $10M for NFT Tokens That Launched Worthless

Key Takeaways

Founder Indicted Over $10 Million NFT Marketplace Raise

The U.S. Department of Justice (DOJ) announced Aug. 5 that Few and Far founder Taj Tarsha had been indicted on securities and wire fraud charges tied to more than $10 million raised for an NFT marketplace. Tarsha was the founder and sole equity owner of the company, which had brought no product to market when the raise began.

Beginning in February 2022, Tarsha sold rights to 95 million FAR tokens through Simple Agreements for Future Tokens, collecting more than $10 million from at least 67 investors. According to prosecutors, offering materials represented that the money would fund development of the Few and Far marketplace for non-fungible tokens and the FAR token meant to circulate through it. Those blockchain-based assets represent ownership of unique items rather than interchangeable units.

Deputy United States Attorney Sean S. Buckley detailed:

“As alleged, Taj Tarsha raised millions of dollars from investors by promising that their investments would be used to build a marketplace for non-fungible tokens, but he instead breached their trust by stealing those funds for his own personal benefit.”

Court filings describe investor money moving into personal wallets for online gambling and speculative cryptocurrency purchases soon after funds arrived. Prosecutors say Tarsha siphoned nearly $1 million more under the pretext of legitimate compensation, taking two bonuses he hid from investors and a co-founder along with a salary he acknowledged was unreasonable at a company with no product and “zero revenue.”

Audit Uncovered Spending as Project Faltered

An internal audit in June 2023 brought that activity to light, according to the indictment, prompting disputes over Few and Far’s finances. The indictment contends Tarsha later regained control of the company treasury, fired nearly all remaining staff, and kept one contractor working on efforts intended to create the appearance of continued marketplace development.

Personal spending continued for at least another year, prosecutors say, extending to a Miami condominium loan, interior design services, an unrelated business, and Tarsha’s DJ hobby.

Other federal NFT cases have involved similar claims over promised projects and investor funds. Prosecutors charged two men in a separate $22 million NFT rug-pull case tied to digital-asset projects marketed to investors.

A separate Evolved Apes case centered on accusations that NFT buyers were promised development of a related video game before project proceeds were transferred away. Three U.K. nationals faced charges in that matter.

FAR Token Collapsed After Launch

Tarsha launched FAR in May 2024, more than two years after the earliest investors paid for rights to the token. Its value has since fallen more than 99%.

Prosecutors stated:

“When he finally launched the FAR token in May 2024, it was effectively worthless and soon ceased trading.”

Tarsha, 34, of Miami, faces one count of securities fraud and one count of wire fraud, with each charge carrying a maximum statutory sentence of 20 years. He was arrested June 6.

The accused spending pattern resembles a separate Clucoin fraud case in which founder Austin Michael Taylor admitted diverting $1.14 million in investor funds and using money at online casinos.

Federal prosecutors also secured a nine-year sentence in another crypto case involving more than $10 million raised from investors through representations about trading expertise and principal protection.