Bitwise Industries founders plead not guilty, face former employees at arraignment
The disgraced co-founders of Bitwise Industries, the once high-flying Fresno-based tech startup that imploded amid millions of dollars of debt, pleaded not guilty Thursday to a federal charge of conspiring to commit wire fraud.
Irma Olguin and Jake Soberal appeared before U.S. Magistrate Sheila K. Oberto along with their attorney’s in what was their first public appearance since the company laid off its entire workforce of 900 people on May 29.
Also in the courtroom were about 10 former Bitwise employees. Several of the employees confronted Soberal and Olguin as they were leaving the courtroom.
One of them asked why they wouldn’t look at them in the face. Another asked them why they pleaded not guilty. They also asked for an apology.
“Each one of us loved our community and you took us down,” said an angry Julian Ramos. “All we wanted was Fresno to f---ing succeed. Look what you’ve done.”
Federal investigators have accused the entrepreneurs of conspiring with each other to lie to board members, investors, lenders, and others about Bitwise’s finances to obtain investment money and loans.
“They did so by fabricating financial information in board presentations and investor materials, as well as altering and forging bank statements, board consents, and other financial records to inflate the company’s revenues, cash balances, and property holdings,” according to the criminal complaint.
Their actions resulted in more than $100 million in losses, court records show.
If convicted, Olguin and Soberal each face a maximum statutory penalty of 20 years in prison and a $250,000 fine.
Oberto allowed the defendants to remain out of custody with strict conditions, including that they surrender their passports, they can not communicate with former board members or potential witnesses and they must provide a property bond.
Soberal used his home as collateral and Olguin provided her mother’s home.
Neither Soberal or Olguin commented after the hearing, nor did their attorneys Dan Olmos of Nolan, Barton, & Olmos in Palo Alto, who represents Olguin and Eric MacMichael of Keker, Van Nest & Peters, of San Francisco.
Fresno attorney Roger Bonakdar, who represents former Bitwise employees in a class action lawsuit, finally caught up with Olguin and Soberal in court, after trying for weeks to serve them with the lawsuit.
Bonakdar walked up to Olguin who was sitting next to her attorney and handed her the lawsuit.
“You have been served,” Bonakdar said as he walked away.
