Blockparty’s Co-founder Has Been Charged with Fraud

Blockparty's Co-founder Has Been Charged with Fraud
Blockparty's Co-founder Has Been Charged with Fraud

Blockparty’s former chief technical officer was detained on Wednesday on suspicion of stealing more than $1 million worth of cash and crypto from the firm, which runs a marketplace for NFTs.

Prosecutors claimed Rikesh Thapa, 28, of San Diego, California, Co-founded the firm in 2017 and resigned in 2019 after refusing to repay $1 million in company funds he promised to retain in his bank account while Blockparty sought another bank.

Thapa, detained in Southern California, is charged with wire fraud. The lawsuit comes at a time when the cryptocurrency sector is experiencing greater uncertainty, exacerbated by the bankruptcy of the cryptocurrency exchange FTX.

A request for comment was not immediately returned by the federal public defender’s office in San Diego, which generally defends defendants following their arrest.

Prosecutors claim in the indictment unsealed in Manhattan federal court on Wednesday that Thapa stole $1 million from the company for “safekeeping” as it sought to diversify its banking alternatives if its major bank stopped doing business with crypto businesses.

Prosecutors alleged that he spent the funds on travel, nightclubs, clothes, and other personal items. Thapa is also accused of taking bitcoins from the firm and deleting the chief executive’s email account to conceal the theft.

According to prosecutors, Thapa flew to Italy in July 2019 to sell part of the company’s native crypto for what proved to be counterfeit funds. Thapa may face up to 20 years in jail if convicted of wire fraud.

According to the company’s website, Blockparty originated as a platform for blockchain-based event tickets and will establish a marketplace for NFTs.