Ethereum Insider Leads Legal Charge Against Fraudulent Masterminds

Former Ethereum advisor Steven Nerayoff is suing Michael Hlady and Marianna Shooshani for alleged fraud that cost him over three-quarters of a million dollars. The lawsuit claims that Hlady and Shooshani created a fictitious consulting firm, North Star Ventures Corp., to deceive Nerayoff into paying for non-existent services. Nerayoff alleges that Hlady posed as a former government agent and that Shooshani introduced him to Hlady, knowing his fraudulent activities. Nerayoff has been vocal about his belief that he was wrongly prosecuted for a crime fabricated by the US government to gain leverage in the crypto industry.

Ethereum Insider Spearheads Legal Battle Against Fraudulent Masterminds

In a pivotal moment for justice, Steven Nerayoff, a former advisor to Ethereum, has initiated a lawsuit against Michael Hlady, also known as Michael Peters, and Marianna Shooshani in the Supreme Court of New York, Nassau County. The lawsuit uncovers a fraudulent scheme orchestrated to deceive Nerayoff, resulting in substantial financial loss.

Scandalous Scheme Exposed

The lawsuit alleges that Hlady and Shooshani created a fictitious consultancy firm, North Star Ventures Corp. ("NSV"), purporting to offer specialized consulting services to Nerayoff. According to the court documents, the defendants falsely presented Hlady as a former government agent with affiliations to the NSA, FBI, and CIA. The complaint further states that NSV claimed to consist of a team of ex-government operatives who could provide indispensable security and business vetting services to Nerayoff's blockchain ventures.

Promises and Deceit

The legal document details that Shooshani and Hlady, under the guise of NSV, induced Nerayoff to enter into a consulting agreement that promised extensive services from individuals supposedly possessing over 125 years of combined experience in critical corporate and government operations. "The agreement also claimed that 'The North Star Venture team has been involved in providing consultation for corporations and deals with combined values exceeding $1 Billion US all done behind the scenes in the utmost of confidentiality,'" the complaint quotes.

Financial Exploitation

From January to October 2018, Nerayoff paid several hundred thousand dollars to NSV based on invoices and requests presented by Hlady and Shooshani. These payments were meant to cover consulting fees, as well as supposed travel and miscellaneous expenses related to the services NSV was contracted to provide. The lawsuit details a list of transactions that include significant sums wired or transferred under the belief they were legitimate business expenses—illustrative of the depth of the alleged fraud.

Shocking Revelation

The turning point in this saga came in November 2018, when Nerayoff discovered that not only did NSV not exist, but Hlady was also a convicted felon, recently released from prison after defrauding a Catholic school. The complaint highlights this shocking revelation with excerpts from Nerayoff's communications to Shooshani expressing his dismay and sense of betrayal. Upon uncovering the truth, Nerayoff confronted Shooshani with messages that read: "This is the worst mistake of my life. He's a two-bit con artist. How could you unleash this criminal on me!?"

Legal Recourse

In response to these allegations, Nerayoff's legal team has presented a multi-faceted legal strategy seeking recovery of the funds paid to Hlady and Shooshani, along with additional damages. The lawsuit articulates several causes of action including fraudulent inducement and common law fraud, underpinning the severity of the defendants' actions.

"Plaintiff only agreed to enter into the January 14, 2018 agreement with NSV upon the express representations from defendants Hlady and Shooshani that defendant Hlady was a former decorated federal agent," the complaint asserts, detailing the reliance of the former Ethereum advisor placed on these misrepresentations.

Wider Corruption Allegations

Nerayoff has also made public his allegations that the US Department of Justice, US Securities and Exchange Commission, and FBI sought to hold him accountable for a fabricated crime over a period of 3.5 years in a lawsuit.

Ethereum's Future at Stake

The outcome of this lawsuit has significant implications for the future of Ethereum and the wider cryptocurrency industry. Nerayoff has hinted that his legal pursuits are far from over, indicating more developments are likely to follow. "And make no mistake, we will not stop until we have uncovered every bit of corruption, including within agencies like the SEC, involved in #EthGate. Expect more to come, and know that I am committed to holding all accountable for their actions," he stated.

As the lawsuit progresses, it is expected to shed light on the extent of the fraud and the potential involvement of other individuals or organizations. The legal battle is not only a quest for justice but also a crucial step in safeguarding the integrity of the cryptocurrency market and restoring trust among investors.