by Sana Bukhari
Thomas John Sfraga known as T.J. Stone received a 45-month federal prison sentence for dishonestly taking $2 million from real estate and cryptocurrency investors. Sfraga received his federal sentence in a federal courtroom as the judge made him pay $1.4 million in cash back to state law enforcement fees.
The actual payment amount that victims should receive will be determined later during a separate procedure. On May 2024 Sfraga accepted responsibility for wire fraud and the court convicted him. The prosecutor disclosed that he tricked different victims into putting money into a sham crypto project named “virtual wallet” by promising to earn up to 60% profit during three months.
Tthe project never existed. Sfraga engaged in a classic pyramid scheme by taking money from victims and later business associates while spending the profits on himself. Sfraga strengthened his credibility through his ownership of Build Strong Homes LLC and Vandelay Contracting Corp as businesses. The project borrowed its name from the fake company Vandelay Industries which appeared on Seinfeld as a joke during the 1990s.
Sfraga Scammed 17 New York Victims Through Crypto Events
As an entertainer and crypto enthusiast who hosted New York crypto events Sfraga used his platform to establish relationships with traders before stealing their money. He defrauded around 17 local New York victims by running his scams in Brooklyn, Staten Island, and Long Island. A single victim provided Sfraga the entire $100,000 to support his fake building venture in cash.
New York Eastern District U.S. Attorney John J. Durham explained how Sfraga harmed his victims both financially and emotionally. “As part of his fraud Sfraga preyed on both his own neighbors and friends while stealing from multiple cryptocurrency investors and team parents of kids who played with his children,” Durham explained.
The case demonstrates how cryptocurrency scams are becoming an increasing danger. According to NASAA the number one financial risk for retail investor growth in 2025 comes from cryptocurrency and social media scams.
People reported scams on social media 32% of the time through Facebook and X. These victims followed by reporting 31% of scams from chat services such as Telegram and WhatsApp.
As the cryptocurrency market grows bigger governments want investors to be careful when they invest in crypto services. The sentence against Sfraga demonstrates that investors face serious issues when they participate in online scams within the developing digital assets market.
#blockchain #crypto, #decentralized, #distributed, #ledger
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