Federal prosecutors in Manhattan have charged the founder of NFT startup Few and Far with securities fraud and wire fraud, alleging that he diverted more than $10 million raised from investors into online gambling, cryptocurrency speculation, and personal expenses rather than building the company's planned decentralized NFT marketplace.
How the Alleged Scheme Unfolded
The 34-year-old founder raised the funds from at least 67 investors beginning in February 2022 through Simple Agreements for Future Tokens, or SAFTs. These agreements gave backers the right to receive 95 million FAR tokens once the network launched, with the understanding that their capital would fund development of a decentralized NFT marketplace.
According to prosecutors, the misappropriation began almost immediately after the fundraising closed. The founder allegedly told investors that bonuses he received were tied to token presale milestones and that company funds were being used to advance the project. In reality, prosecutors claim, he had dismissed most employees while directing a single contractor to create the appearance that the marketplace was functional.
Where the Money Went
The indictment alleges that investor funds were spent on a loan for a Miami condominium, interior design services, and expenses related to a personal DJ hobby. Online gambling and cryptocurrency speculation were also identified as destinations for the misappropriated capital. An internal audit in June 2023 uncovered the alleged misconduct, leading to the investigation that resulted in the charges.
The FAR token launched in May 2024 but quickly became effectively worthless and stopped trading, according to prosecutors. For investors who participated in the SAFT round, the token's collapse meant their original investment was wiped out entirely, with the funds they believed were building a marketplace instead funding a personal lifestyle.
The Broader Regulatory Crackdown on Crypto Fraud
The charges fit into a broader pattern of enforcement actions targeting fraud in the cryptocurrency and NFT sectors. As the digital asset market matured, the number of projects raising capital through token sales far outpaced the number of legitimate businesses being built. Many founders treated SAFT proceeds as personal windfalls rather than development capital, a practice that regulators are now systematically pursuing.
The case also highlights the risks inherent in SAFT structures, which allow projects to raise funds before any product exists. Unlike traditional equity investments, where shareholders have legal claim to a company's assets, SAFT holders receive tokens that can become worthless if the project fails or the founders misappropriate the funds. For related coverage on enforcement actions in the crypto space, see our analysis of Binance's token delistings and risk controls.
A Cautionary Tale for NFT Investors
The Few and Far case underscores the importance of due diligence in early-stage crypto investments. The alleged misconduct went undetected for over a year before an internal audit exposed it, suggesting that investors relied on the founder's representations without independent verification of how their funds were being deployed. For a related case involving criminal activity in the crypto space, see our coverage of criminal charges in a Bitcoin robbery plot.
The founder was arrested on June 6 and the case has been assigned to a federal judge in the Southern District of New York. Each charge carries a maximum sentence of 20 years in prison if convicted. The outcome of the case will likely influence how future SAFT offerings are structured and monitored, particularly the requirements for independent audits and transparency in fund allocation.
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