Ex-fintech CEO sentenced to 3.75 years over price manipulation scheme

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A federal judge sentenced Michael Kane and Shane Hampton to prison for their roles in manipulating cryptocurrency prices at Hydrogen Technology Corporation.

A federal judge in Florida recognized the HYDRO token as an investment contract qualifying as a security under SEC guidelines.

A Florida judge has sentenced Michael Kane, the former CEO of Hydrogen Technology Corporation, to roughly four years behind bars after a guilty plea.Kane to 45 months in prison for securities fraud related to a crypto price manipulation scheme. Shane Hampton, Hydrogen Technology’s former Head of Financial Engineering, received a sentence of 35 months for similar crimes.

“or the first time, a jury in a federal criminal trial found that a cryptocurrency was a security and that manipulating cryptocurrency prices was securities fraud,” said Principal Deputy Assistant Attorney General Nicole Argentieri. “This prosecution and the sentences imposed today should serve as a warning: The Criminal Division will not hesitate to use all tools at its disposal — including the federal securities laws — to protect the integrity of cryptocurrency markets.

The U.S. Securities and Exchange Commission filed a lawsuit against Kane and Hydrogen Technology in September 2022, alleging the former CEO used the firm’s market maker to perpetrate a scheme manipulating the volume and price of the company’s Hydro token. In April 2023, a New York judge ordered Kane and the firm toand civil penalties. At roughly the same time, Kane’s and Hampton’s criminal indictments in the Southern District of Florida were announced.

 

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