Fraud Week: How Crypto Convict Made Millions Before Getting Caught, with Ray Trapani and Jonny B Good

Ray Trapani
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Ray Trapani
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Megyn Kelly
Welcome to the Megyn Kelly show live on SiriusXM Channel 111 every weekday at noon.

Ray Trapani
East.

Megyn Kelly
Ray Trapani was always fascinated with money. Those who knew him as a child knew that he would someday become a millionaire. But they couldn't imagine how. In the mid 2010s, he was broke and hundreds of thousands of dollars in debt. But then he and a business partner set out on a mission to create a bitcoin debit card. The company they created and the technology they promoted, however, was all a lie, and it did not take long for everything to come crashing down. Today, we bring you the story that was the focus of the Netflix documentary Bitcond, with the man at the center of it all. Ray Trapani is the founder and former coo of Bitcoin company Centratech. He's joined today by his high school best friend and co host of his new podcast, creating a con. The story of bitcond. Johnny be good. That's his friend.

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Ray Trapani
Thanks for having us.

Megyn Kelly
Nice to see you. Ok, I so I watched the Netflix documentary and Ray I gotta tell you the truth. I found you completely charming in so many ways. And I ended the series thinking he's definitely still a criminal. Am I wrong?

Ray Trapani
Yeah, you're definitely wrong in that regard.

I've changed a lot.

Megyn Kelly
You have? Okay, well, like what did it getting convicted because you didn't have to serve jail. So I can, I can see how actual prison time would reform a guy, but what did it?

Ray Trapani
So I was addicted to drugs since I was twelve. So then basically once I got arrested, this time is the first time being sober since for, you know, 15 years of drug use. So that really is what changed me. You know, all these crimes I did, I always did them under the influence.

Megyn Kelly
Hmm. I really feel like, not for nothing, but we've interviewed many felons on this show and some guys did a lot of frauds over the course of their lives in their twenties and their thirties, and then wound up using their talents for good, like helped the state. And I know you did work with the government ultimately, but like just FYI, this could potentially be Elaine. Elaine for you because you're a talented guy in many ways and you actually successfully pulled off a lot of these capers.

But I just want to say that for the record before we get going, because I think you could have a great life in front of you. And I hope it's all used for good. Now, Johnny, I. You were in the documentary a bit, but not as much as Ray, who's the star, because it's his story. But you guys. What? You've been best friends since you were kids?

Johnny Be Good
Yeah, we've been best friends since third grade or fourth grade.

And we grew up together in the same town. I always considered him like a brother to me and we just took very different paths in life. But we always remained best friends, despite. If you wrote us down on page.

Megyn Kelly
Did you know, like, okay, you know Ray?

Eh, you know, is he one of those guys like he cheated on the test. Was there like a strain of dishonesty or potential future fraud or did he color within the lines? What's that?

Johnny Be Good
No, this was, this was like a lot of people ask me, did you like, were you shocked? It was very natural progression. Throughout Ray's whole life, it was like a progression of criminality.

Ray has been involved in criminal activity since he's twelve years old. So this was not really a shock to me.

Megyn Kelly
It's interesting because it sounds like Ray, like we meet your mom and she seems totally lovely, but around you growing up, you know, one important thing, which is your dad split so you didn't really have a father growing up. And then now you sims come out and said you actually suffered abuse too, sexual abuse as a young man.

So explain how you think you got to the point where crossing the legal lines just kind of wasn't a thing for you.

Ray Trapani
Yeah. So basically as a kid from eight to twelve, I was being molested pretty much regularly. And my mom, my dad had left and my mom was working 12 hours a day in the ICU as a nurse. So from that, and then I also. It was, I felt like it was happening and it was so obvious to everybody in my family that everybody always knew. So pretty much at a very young age, I was like, it's me against the world. And because of that, I also, like, viewed my grandfather as like a. He was a.

He started a union in New York City. So pretty much anybody that's connected with the unions has some sort of connection. So he presented as like a mobster figure. And he was also like the one that always had cash, would help my mom get the house or get me my first car. So I was just like, that's who my idol is. And I viewed it as like it was criminal activity based. Right. So I was like, that's what the route I'm going to take.

In the documentary, I talked about trauma for about 2 hours before I said, I always want to be a criminal. But they just took the last line and made it seemed like that was just like my opening thing to say.

Megyn Kelly
Right. That did come out of nowhere, so that makes more sense. So you was the first actual step toward criminality, the use of drugs or just walk us through, like that first line crossed as you remember it.

Johnny Be Good
Yeah.

Ray Trapani
The same person that was abusing me, like, had me smoking weed at twelve. And then from there I, I became friends with one of like, the biggest drug dealers in. Well, his little brother, but the biggest drug dealers in Long island for weed. And I just started selling weed. That was like my first step into crime.

Megyn Kelly
Hmm. And have you, you've never said who this person was who hurt you?

Ray Trapani
No, it was my stepbrother.

Megyn Kelly
How did it finally stop?

Ray Trapani
I got bit. I grew up, you know, I started like, dating. What happened was like, I was always questioning my sexuality up until twelve. And then I got a girlfriend and I pretty much had my first interaction with a girl sexually. And I was like, oh, well, I'm definitely not. I'm definitely not gay.

So then that's kind of what? Just like, I pretty much at like 1314. I just was always with that girl, she had a troubled childhood also. And my mom, we had, like, a crazy household, but she basically moved into my house, like, at, like, 1415, like, kind of getting away from her family as well. So that's kind of what just guided me away. Then they got a divorce pretty much, like, right around that same time. So he was just out of the picture completely.

I also have two boys, by the way, so I have two little boys now, you know?

Megyn Kelly
Yes. I'm sure you're very protective of them. Has he contacted you to say, what are you doing? Or I'm sorry, or threatened you? Like, how has he reacted to you going public with that?

Ray Trapani
I have no idea. I mean, I haven't heard from him since I was 17. So, I mean, he. He was always, like, he was very different than me. And my brothers were, like, beach bums. My brothers were big surfers. And then they were, like, kind of dirty fingernails rock band type of guy. So I honestly probably live in, like, the boondocks, and I really have no idea what's going on with them.

Megyn Kelly
You, you know, wind up getting a little older, and then we were talking about sort of your first foray into crossing legal lines, and you had the family influence. You kind of thought this was what people did. So what was it? Was it drugs?

Ray Trapani
At first, yeah. I mean, I was doing drugs, and I started selling drugs. And then pretty much quickly that evolved into fraud because it was, like, drug based fraud. So I had someone. Someone stole a pad because I was doing OxyContin. And then someone stole a prescription pad and just gave it to me. And I. I just had this kid write out his prescriptions, and I basically had, like, at first, like, me and my girlfriend went in and the scripts worked. They filled. And at the time, OxyContin. Like, I. I was, um, you know, like, the. The opiate epidemic really hit my generation hard. So everybody was doing OxyContin. It was like no one was talking about the negative effects of it, and everybody was just trying it. So the pills sold very fast, and I was fully addicted by 1516. And then this happened about 17 years old. That was, like, my first fraud, and I got arrested for that case as well.

Megyn Kelly
What year was that?

Ray Trapani
So if I was 17, I was born in 91. That was 2008.

Megyn Kelly
Okay. And, Johnny, did you. Were you there for this? Like, do you remember Ray getting involved with drugs and, you know, sort of going down this lane?

Johnny Be Good
I mean, like, he, like, he said, the opiate epidemic hit our generation pretty hard. So this was like, everyone was taking these pills.

And the high school we went to, we didn't even know was a synthetic heroin at the time. But people used to be selling blues or oxies for two, $3 a pop, and then all of a sudden, they went to $45 when everything started cracking down, which then everyone turned to heroin experts because they were addicted. All of these things were super common growing up. So we were talking the other day about, if you go through our yearbook, we probably know more people that died from addiction than anything else.

So, yeah, it was kind of par for the course.

Megyn Kelly
I know you grew up in Long island, right? But what, like, what kind of an area was it? Long Island's got all sorts of different neighborhoods.

Johnny Be Good
Oh, a beautiful, picturesque place called Atlantic beach. Love it.

It really is.

Sorry, go ahead.

So it really is. Like, on the surface, it's, you know, everything's beautiful and perfect, but there's, like, a darkness that kind of, you know, lies underneath.

And not just the drugs in Lang Beach, I think, like, the culture in general, so. And I think that's kind of the same with a lot of these small towns.

Megyn Kelly
Ray, I can't believe you got away with taking. Somebody swiped a doctor's prescription pad, as you point out, out of a doctor's office, and then you started writing prescriptions out. Like, 2008 was not, you know, 1998, when we really had no clue and the opioid crisis was first start, you know, like, it's amazing to me that they wouldn't double check the doctor's signature. Like, how did you not get caught right away on that one?

Ray Trapani
So there was a method. So, basically, the doctor's offices close at around 607:00 so you make sure you go to the pharmacy after the doctor's office is closed, because they always call to verify, but they'll fill the prescription without the doctor verifying if the doctor's office is closed. So we would just do that. But the pharmacies were all in on the opiate epidemic. Walgreens got sued. I believe that's where we always went. And if you see a bunch of skinny, crackhead looking kids coming into your pharmacy, one after the other, filling prescriptions for OxyContin, you would assume something's wrong.

We didn't get caught until we went to a mom and pop pharmacy, and that was when they were like, oh, this is definitely something wrong here, and they called the cops. So everybody was in on that whole opioid epidemic.

Megyn Kelly
That's fascinating and frankly, believable.

So, okay, you get caught, you don't wind up serving jail time you get kind of a slap on the wrist, right?

Ray Trapani
Yeah. For that, I did drug court for pretty much, like, every single time I would get arrested, I would always go to rehab and then go, like, do some sort of drug outpatient type of thing.

Johnny Be Good
Always.

Ray Trapani
But I always had very good lawyers, obviously.

Megyn Kelly
And you're a good looking guy. Do you feel like you were able to charm these judges? Like, I'm just wondering how that played, because, you know, you're gonna have a lot of people out there being like, if he was a black kid from Chicago, he would have been put behind bars.

Ray Trapani
Yeah, I hear that regularly. And I don't know the correct answer. I'm a handsome white guy, so, I mean, I don't really have the answer for what would happen if I was a black guy. Really? I don't know.

Megyn Kelly
Right, right.

Ray Trapani
But I'm sure, like, it somewhat has to play into, you know, like, I. I don't know. You know, I can't really give you an answer for that one.

Megyn Kelly
Well, we'll let the audience take a look at the YouTube and make up their own minds on it. All right. So then you wind up graduating to a car, like, getting a lovely, like, car rental service, going exotic. Miami exotic, right. That's what it was called. And this was. But it was not in Miami. Or was it actually in Miami?

Johnny Be Good
Yeah.

Ray Trapani
So I basically, like, during that time of drug court, I started working in construction. My grandfather got me a union card. I started working. I was like, I hate this. This is terrible. I don't know how anybody could work a job like this.

Megyn Kelly
This honest job is not for me.

Ray Trapani
Yeah. I was breaking my back doing scaffolding at the new World Trade center for, like, a couple of years there. And then I basically was. I went and visited my friend down in Miami, and that's when I. At first, I found this loophole in Venmo when I first moved down there, and I was able to just send money without having money in the bank account to back it.

And I just, like, kind of exploited that loophole to the maximum extent, and, you know, we made, like, a good amount of money on it. I don't know the exact figure. But from there, I was like, I came back to New York. I told my girlfriend, I was like, I'm moving down to Miami. She didn't even believe me. And then I was like, you're either coming with me, or you're staying here. And I just the next day, put my tv and everything in my car and drove down there and kind of continued with the Venmo thing for a little bit there, built up a few hundred thousand, and from there, we parlayed that into opening a exotic car rental business.

Megyn Kelly
Yeah, the Venmo scheme is actually very interesting to me, too, because I read you were talking about how if the way it works is like, let's say you wanted to venmo three grand, Johnny, but you had $2 in your account on Venmo. There was this period where Venmo would send it, even though you didn't have the funds. And they might shut down that account of yours, but they didn't come after you for it.

Ray Trapani
Yeah, Venmo, PayPal, they all had the same issue. I don't know how they allowed this, but basically, they would front the money as long as you had one transaction done through your account. They would just front the money as soon as you sent it, and the other person would get it and be able to cash it out, and your account would just go negative. Three, like, basically bounce against the bank account, and you'd get a $35, I don't know, whatever the fee would be. And then your venmo would just get banned. And back then, they didn't even bill you for. It was just like, your Venmo was banned. So it was like, all right, we're going to find, like, 100 people to do the exact same thing. And I just created, like, fake Instagram accounts to find college kids that were broke that needed money quick and give them $1,000 out of the transaction. Take the other couple thousand. And we just did that for a little bit there.

Megyn Kelly
I mean, I have to give you points for ingenuity. Like, who would have even thought about this? How did you discover that this could even happen?

Ray Trapani
I was just sitting on the balcony. This is something Johnny speaks to a lot as far as how I view systems.

I mean, maybe Johnny can expand. Yeah.

Johnny Be Good
I mean, even going back to when we were talking about the pharmacy thing and the Venmo thing, Ray just has a very unique way of looking at systems and then, like, figuring out a way to exploit them. You mentioned earlier how, like, he's very intelligent in a lot of ways, and if he would have applied that somewhere else, like, he could have done it. I mean, you did do some amazing things, but you could have done some kind of really world changing things.

It's always fascinated me, and it's like, it taught me a new way to look at things in general. Ray can look at a system and, like, immediately figure it out and figure out where the flaws lie.

Megyn Kelly
It is kind of a gift, and it could be used for good if you put on the white hat. You know, you spent a lot of time wearing the dark hat, but now I think you're kind of in a transition period where you're, you know, you're totally owning up to what life was like before, and it's a new star. Okay, so let's get to. You're running the exotic car company. You've got this money that you kind of stole. Not kind of. You did steal via Venmo, and that was your seed money for getting all these Lamborghinis and Ferraris and renting them out to people who wanted a beautiful rental car. And among those who came in were some celebrities. And this would later prove very important, these connections that you were forming while doing this. Who were they?

Ray Trapani
We had pretty much every celebrity you can ever think of, but they're mostly like rappers.

That's like, everybody comes to Miami and just rents cars and spends all their money. Like, as far as that business down in Miami, it's one of the best businesses. I wish I would have stayed in, in that business, but, you know, everybody from Rick Ross, Lil Wayne, young, young Ma, like, all these names, but Floyd Mayweather, DJ Khaled, those type of guys are every time they're down in Miami, unless they live there now. A lot of them live there now, but it's just pretty much what everybody does. Everybody wants a nice car. Even when I go down to Miami, I always would want to get a nice car.

Megyn Kelly
So you're making good money, but you're spending a ton, and this would ultimately be a problem. What were you spending all the money on?

Ray Trapani
So that's one thing I always talk about. Now, at that point, I was trying to go legit with that business, and, of course, I had bad spending habits. I was a degenerate gambler.

Drugs, going out to the club, but also my partners were not the best partners, and they were also, like, stealing money from me and kind of just embezzling money from the company. So that became a big issue as well. And then, like, you know, but we were also just going out to the club. Every day in Miami, you go out to the club, it's $10,000. It's not a cheap night ever, but anything you can imagine. We also had, like, a beautiful penthouse apartment in Boca that we all lived in. And, you know, our offices are just pretty much anything you can imagine as far as, like, Miami scene for young kids is what we were spending our money on.

Megyn Kelly
So you're earning big, but you're spending big. And it turns out there was an embezzlement problem on top of all of it, which isn't a great recipe for keeping the business afloat. All right, so then how does this parlay into the subject of, you know, the Netflix documentary, your podcast, tons of articles? You know, this story just blew up once you guys got caught for what you did with centra. S c E N t R a.

Take us from exotic Miami exotic, the car rental thing, to the birth of this crypto company.

Ray Trapani
Yeah. So basically, there was a point there where I go, like, the business is about 400,000 in debt, and I go to Vegas, and I basically said, I brought my last hundred thousand to Vegas, and I just was like, I played in the World Series of poker. This is my genius attempt to try to make the 400,000 back played in the World Series of poker. And then I basically played baccarat with the last of it in hopes to try to make it all back or I was going to kill myself. So I. And then I lost it all. And then I just took about 100 Xanax, or like 50, 60 Xanax, and I basically just fell asleep for 24 hours and woke up. And then from there, I fly back and my two business partners are arguing with each other about where this money went. They were basically blaming each other because one of them, the check was cash in one of their names for, like, over 100,000. And they were just saying, this guy wrote it out and he cashed it. And I didn't know what was the truth. And I ended up deciding to get rid of one of my partners and go with the other one, who ended up being my partner in Centratech. So after we had gotten rid of the first guy, this other guy was just like, one day I just saw him trading. I thought it was stocks, and he was like, oh, this is the new thing, cryptocurrency. And I was like, whatever that means. You know what I mean? I had no clue. But then he broke it down for me. And from there, he ended up losing a bunch while he was trading. And from there, he was trying to sue coinbase for what they call a flash crash.

I don't know if anybody really know what that means, but basically the price just went down from a couple hundred dollars down to zero and then right back up. So anybody that has a trade position gets liquidated right away. And so he was trying to sue, and through trying to sue, he went on Reddit and found out about these companies that are creating icos, which is basically a cryptocurrency version of an IPO, and they're like just young kids raising hundreds of millions of dollars.

Megyn Kelly
Hmm. So, Johnny, this is one of the things that they talk about, and I know you guys address is like, the industry is totally unregulated. I mean, it remains completely unregulated for the most part. But this, if you were looking to start a fraud, this would be a great lane to do it in.

Johnny Be Good
Yeah. And Ray kind of taught me that people like Ray and sorby, when they're thinking, that was his partner at the time. When they're thinking of, like, what to do, they look for unregulated markets.

Thats like chumming the water for sharks pretty much.

And to raise point, since hes been caught, things have not gotten better. Theyve gotten, it seems like, worse in the crypto space where we were joking before, at least centra tried to hide it behind some legitimacy.

A lot of the coins that are coming out today are just, they're like open scams with no concept other than get rich quick.

Megyn Kelly
What's amazing to me in watching the story is the fraud was so bold.

The claims you were making were so bold. False, but bold.

And it took a while for anyone to figure it out. You made tens of millions of dollars before anybody was like, what the hell's happening here? Before you got an SEC letter. It's crazy how long it went on and how much money you made, despite what seems to be an easily, you know, pierced veil of legitimacy. So can you just give us a couple of things that you guys did to make this company? Well, before we get to that, explain what the theory was that you were selling, because I still don't totally understand. It's like a credit card for crypto. But one of my big questions was, how on earth could you ever fool anybody into thinking such a thing is legitimate? Because they'd be looking for their crypto credit card to arrive in the mail, and then they'd be looking to use it, and they'd find out really fast, this doesn't work. No one accepts this. This actually isn't worth anything.

Ray Trapani
Yeah, so there's a lot of things to break down there. So, basically, when you create one of these companies, you create it based on a concept. And originally, when we were raising the money, we had said that we were in beta testing. Right. So we, we gave them a, this is a timeline of when the cards would be ready for mass adoption, basically. So the whole time we were raising the money. People weren't expecting cards. They were just basically looking at us, make videos using, like, what was beta tested. And from there, they're investing on the concept. Not as much as like, oh, I pay now, I get a card. And basically the concept was how it really works and how it works today.

What people don't realize is that we ended up actually developing it by the time we got arrested and we had the cards working with the wallet. But so how it works is essentially you have cryptocurrency in a crypto wallet. And then when you have a debit card or a prepaid card, and the prepaid card is backed by a pool of fiat currency. So then as soon as the person swipes, it pays in fiat currency. But on our side, on the back end, we take out the cryptocurrency value of how much they spent in fiat. And so we just have a fiat pool that blocks it. Like cash, US dollar, whatever country, euros, US dollar, whatever country the card is being used in.

Megyn Kelly
So just explain. So the way it would work, the way you'd sell it is, ok, MEgyn Kelly, here's a card. You buy it and then what? How would you tell me? This is all going to go down.

Ray Trapani
So you're going to be able to swipe your card and then it's going to subtract that amount in cryptocurrency, bitcoin, whatever crypto you're using out of your crypto wallet.

Megyn Kelly
And where would you say I could use this card?

Anywhere, like at the Walgreens.

Ray Trapani
It's a Visa card. It's a Visa card. Yeah. You can just go to the store and use it. Like it's. They have them now. There's other companies that were our competitors that made the same lies that now own Staples center. They made the exact same lies as us. They said they had Visa, Mastercard, they owned Staples Center, Staples center. They just settled.

So it works. The concept works.

Megyn Kelly
That's unbelievable. Okay, so we've gotten there. The vision actually was realized, but wasn't totally real while you were doing it and pushing it.

Ray Trapani
Yeah, absolutely.

Megyn Kelly
Yeah, go ahead.

Ray Trapani
No, we completely lied in the very beginning. That's 100% true. And that's what we were arrested for. People don't, people like Netflix, like, sensationalized the part about just like the crime part, right. We completely lied. We made up a fake CEO. We didn't have visa, Mastercard in the beginning, but once we raised a few million dollars, we actually worked. We hired 40 plus developers in house to develop this product and we built towards what we were trying to develop, and we got there by the time we got arrested. But that's just not talked about ever.

Megyn Kelly
That's the bitter irony of the whole thing.

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And it turns out this guy didn't even mean to be writing it about your company. Hold on, there's a little clip, I think, from the Netflix special about this guy. Let's play it, and then you guys can explain it in SAP one.

Ray Trapani
Clearly there was a reason why all this big money was coming in.

People in our chat room started saying, cliff High wrote this article. You guys see that? And me and Sorbet are like, Joe jumped in. There were like, of course we know Cliff high. Like, we love Cliff eye. Like, yeah, he's the man. We had no fucking idea who he was.

Megyn Kelly
The whole banking system is failing. But in the meantime, we're all going to be dealing with real money in the form of gold, silver, and cryptos. And the cryptos are going to be the fluid part of it.

Ray Trapani
He was like a crypto guru type of guy. He's just some old nerd.

He was saying, this is gonna be a big thing. He put out this press release telling all his big investors to put out their money for Centrum.

We went from having like 200 people in our slack channel to having like 2000 people within, like, you know, a couple hours.

Time to go to the stratosphere. This company's taking off.

Megyn Kelly
Unbelievable.

Ray Trapani
So it's a great question.

Megyn Kelly
So it was just dumb luck.

Ray Trapani
So we had raised a few hundred thousand completely, like, just grinding it out, going in different chat rooms, pitching our idea. Then that article came out and within a couple hours, a few million came in.

Megyn Kelly
Oh, my God. I kind of feel bad for Cliff High. Do you feel bad for him?

Ray Trapani
I do too. He's a super nice guy and he's actually very intelligent. What he does is he uses like, almost like an AI type of system that searches the Internet for things. And he didn't do his due diligence before he put out his press release that had us in there. It basically combined the name censure with a bank. And that was why that confusion happened.

Megyn Kelly
Oh, my.

You can't make this stuff up, right. It's like this poor guy now since he's come out, he's like, very sorry that he did all this and all that, but the damage is done.

All right, so how long were things rolling around? Rolling along post the cliff high mistaken article with all the money pouring in.

Ray Trapani
So. So how long was things going on?

Megyn Kelly
Well, like, until the New York Times reporter came sniffing around. Like, what? How long were the glory days before somebody was really kicking the tires?

Ray Trapani
It was really like a year, period where everything was going good. My timelines are terrible, though, from my substance abuse. I really, like.

Megyn Kelly
I'm not going to hold you to it. I'm just looking for a general feel. All right. So, like around a year, period and what.

Ray Trapani
Yeah.

Megyn Kelly
What kind of dough are you bringing.

Ray Trapani
In at the height? Like, what happened was crazy, too. Is that everything we had raised? They said we raised 32 million, but at the same time as we raised that money, crypto went up like ten x. So it became a few hundred million pretty quickly. So we were making about 2 million a day at some points. And then what people. There's another part that people never really covered is I figured out a way to basically control the price from, like, this decentralized exchange that ended up getting shut down. But there was, like, a way back then that you could essentially, like, artificially control the price.

Megyn Kelly
It's amazing. Like, you've got these genius powers that were used for evil, but it's wonderful to hear you talking about them and letting us all in on the secrets in a way. Because it's like this thing is still big and it's still out there and there are tons of people who are buying crypto as we speak. I mean, I guess we should ask that. Johnny, could you want to speak to. This is like, it's not, is it all a fraud? I mean, I know some people say this about bitcoin and ethereum. Like, it's all fraudulent.

Johnny Be Good
I think there's so many things, people hate nuance nowadays, and, like, there's so many things that are.

Some things. Yeah, do. Do your research. Some of them are legitimate, some of them are not legitimate. And just because one of them is a scam, or, I mean, in crypto's case, a few hundred of them are a scam, doesn't mean they all are a scam. You know, I would just say stick to the basics. And if there's a coin named after, like, an animal, probably don't buy that one.

Megyn Kelly
So let me just ask you, Ray, were you shocked, shocked when Sam Bankman freed got arrested and his company imploded?

Ray Trapani
No, not at all.

I wasn't. I wasn't shocked. I think in cryptocurrency, pretty much, like, 95% of it is fraud. Like, if it's not considered fraud, it's insiders. You know, like, the insiders are the ones always getting rich. And even, like, the controlling the price thing now, it's just done by AI bots, and they call them market makers. It's all the same thing. All these projects are making crazy money now, and their new loophole is just don't offer any product. Just, let's just tell everybody they're going to get rich off a picture of a dog.

Megyn Kelly
Wow. So do you, like, do you own any crypto now, either one of you guys?

Ray Trapani
Oh, yeah, a little bit.

Johnny Be Good
Yeah, same.

Megyn Kelly
Well, so why, why, why would you trust anybody who's in the market now?

Ray Trapani
So, like, the ability to, like, bitcoin and ethereum, in my opinion, are great investments. I mean, not financial advice or whatever they want you to say there. But I think there, there's a, there's a great thing to be able to just send money to someone in China instantly without any bank involvement. I think that's the real use case, in my opinion. There's some smaller use cases. Maybe if you want to, like, put a cryptocurrency in a game and make it something like that, or there's a couple of fun use cases. I guess people can make out that are, there's probably legitimate projects trying to do it, but for the most part, you just want to be able to spend, I mean, send money anywhere. Like, I can send money to Johnny without having to go on the bank. Or I can send money to anybody without having to go on the bank.

Megyn Kelly
Hmm.

Okay, so back to your company, Centratech.

This guy writes the article, the money's pouring in. And when you say it was worth more, like between two and 300 million, that you're not suggesting you had that money in the bank. Right? What are you suggesting about? How do you put, get that number on the company?

Ray Trapani
So the market cap of the company was 600 million the cent. Like, we created 100 million center tokens. That was worth $6 of the coin, and we had sold those, and we kept 32 million. So that's alone about 150 million of company owned centra tokens. But then we also raised 200,000 Ethereum, which were at a time over $1,000. So that's another 200 million. So at one point, our company has 350 million. If we wanted to liquidate it, we were liquidating a lot to be able to pay our employees and, you know, do whatever we wanted to do. So realistically, we had liquid. Like, it's tough because, like, you would say that's not liquid. Maybe because it's in cryptocurrency, but we could have sold any amount of it at any time and made it liquid instantly.

Megyn Kelly
Hmm. All right, so things are rolling, and you're living the high life, enjoying the money and the Armani suits and all of the accoutrements, the fancy watch, the Rolex and so on. And then a writer from the New York Times named Nathaniel Popper gives you guys a call, and he wants to figure out a couple of things about the company, including why on your website, I guess, you decided to go with. Just everyone went to Harvard Business school. Every single person there went to Harvard. Like, you didn't. Johnny's laughing. Why didn't you, like, mix it up a little? You know, like, this guy went to Wharton, and this guy went to like, why did you? It seemed effortless to just say everyone's Harvard.

Ray Trapani
Well, the funny, there's a funny story there, actually, because what happened was someone had said something about us, and we all.

Sorby was like, everybody created LinkedIn, and we all created those Linkedins separately in different houses. And then we all put Harvard. And then right away when we noticed that I changed mine to UCLA pretty, pretty quickly, I don't know what Forgus did. So that was just the original thing, was the Harvard thing. And it's pretty funny. Like, that would just all of our instant, like, oh, yeah, we all went to Harvard.

Megyn Kelly
Can you explain Farkus, because we haven't talked about him. We talked about Sorby, your buddy, who you knew from earlier. And who's this third guy? Because he becomes important.

Ray Trapani
Yeah, I feel bad. I always talk so bad about him. He's a nice kid. He's just. He's Sorby's fiance's brother, and he kind of got roped into this. In my opinion, he shouldn't have got any jail time. I even told the FBI that, and they basically just said kind of something along the lines of, if someone's telling you that you're doing your fraud, you can't be like, I didn't know. You know, like. But he really didn't. Like, even though he was involved in the conversations, I don't think he comprehended what me and Sorby were talking about.

Like, he saw, like, oh, we're trying to build a company.

Megyn Kelly
He's in the documentary, and I think it's fair to say can't stand you.

Ray Trapani
Yeah. Yeah. I think what they did, also in Netflix is, like, they showed him a clip of me talking about him to, like, rile him up before he talked, because there was points there, like.

Like, other edits where I think he was talking more highly of, like, I don't think he has any real issue with me. His issue is that, like, I'm talking bad about him, and I'm not trying to talk bad about him. I'm saying I don't think he was even involved in, like, the actual crime of everything.

Megyn Kelly
Who was the brains of the operation between you, Sorby and Farkas?

Ray Trapani
Sorby was definitely the head honcho, for sure, the main guy, and I was second in command.

He was the original idea guy, and I was just the guy that would manage the employees. And then I found out some other loopholes throughout that time, but, yeah. And the funny thing is, me and Sorby both went to the same high school.

Megyn Kelly
Did you guys go to college at all?

Ray Trapani
I think Sorby went to St. John's for a year, and then he got kicked out for.

Megyn Kelly
So not Harvard.

Okay. All right. So you set it up. The website is, you know, kind of. And you. And as I understand it, Johnny, they stole the website from another tech company.

Johnny Be Good
The well. What do you mean? They stole the website?

Megyn Kelly
Or the well, like, they just copied somebody else's website. Right. It wasn't like they didn't come up. They kind of found a company that looked like it was in business.

Johnny Be Good
There's a lot of just copying and then changing things going around at censure tech, from the idea itself to the website to, I don't know, most facets.

Megyn Kelly
Of it, it's amazing to me that you would. Again, it's a bold move to just steal somebody else's as opposed to just. That's another indicator obvious of fraud. And perhaps most bold move of all, Ray, was to say that you had struck a partnership with Visa and Mastercard in connection with your cards, which, of course, would legitimize it in the eyes of a potential consumer. And this New York Times reporter Nathaniel Popper found out that was not in any way true. Here's a bit more from bitcond via Netflix of that satu.

Ray Trapani
Ray, I've been coming across other questions that have come up around centra. The first thing is Visa has said nobody has applied to issue a central card.

I mean, I know details about that, you know, I mean, but, I mean, I can't give you direct answers on that.

These guys say that they're issuing a card with Visa. They have pictures up on their website that have cards that have the Visa logo on it. One of the first things I did was call Visa. They said, we have no idea who these guys are, and there is no record of an application. They're going to have to take that off of their website.

I can't.

Johnny Be Good
Yeah, okay.

Ray Trapani
I mean, Visa's just saying this company.

Johnny Be Good
Sentra, is not allowed to issue a.

Ray Trapani
Card with Visa on it till we do the mass orders. They're never going to speak on them.

Anytime somebody tells you, you know, I don't really feel comfortable answering that question, or these are questions that are very, very tough for me to answer to you. You know what I mean? Like, you know that there's something going on here.

Megyn Kelly
Oh, God. This was not a banner moment for you, Ray. Were you. You were definitely drugged up during these phone calls? No.

Ray Trapani
Oh, I was. At that point in my life, I was taking 20 Xanax a day. Like 40 milligrams of Xanax every single day. The whole time I was running Sentra then. Besides that, I was.

Megyn Kelly
So you didn't feel panic? I mean, on the bright side, you probably didn't panic when you got that phone call.

Ray Trapani
Yeah, I was probably smiling on the phone, but, yeah, I felt nothing. That was the thing. I really felt absolutely nothing that entire time. I was empty in that way. But, I mean, obviously it's an edit to make me set. Like, they literally just highlighted just my.

As much as possible. But I definitely was high as a kite there.

Megyn Kelly
He talks about how, as he's, the New York Times reporter is doing his investigation, he's watching the Centratech website, and it's removing the references to Visa and Mastercard, taking down the LinkedIn's that say Harvard, like, as he calls with, hey, what about this? What about this? You guys are actively changing it, which is just the worst possible thing you can do if nothing says, I'm committing a fraud like that.

So I like, in a way, you guys were very sophisticated, and in a way, you were very keystone. Am I wrong?

Ray Trapani
You're 100% right.

We were in over our heads as far as how big this thing got right. We had done fraud before, but it's easy when it's small scale stuff. But once you're in the public eye and a company gets to the point we did, after we had those huge endorsements, it got tough because there were just so many eyes on you. So every little thing that you had that was not true would just get called out instantly. So, like, throughout the whole time we were taking Visa down, putting it back on just to keep an investor. Like, that was the thing is that the investors were controlling our, like, our decisions on what to do on the website. Like, if a guy had invested a million dollars, and then he was like, oh, where'd Visa, Mastercard? We just put it right back up.

We're just trying to keep whatever money we had.

Megyn Kelly
So you mentioned the celebs. This is where DJ Khaled and Floyd Mayweather from exotic cars or Miami exotic come back into the story. How did you use them to promote this fake company?

Ray Trapani
Yeah, it's always pretty funny that people follow any sort of rapper or boxers financial advice, but that's the cryptocurrency world for you.

So, yeah, we just basically reached out for an endorsement through their managers, which the manager was, like, someone we had met in the club scene, more so than even the car scene.

And pretty much you just pay them and you give them a script, and they say whatever you want them to say.

You know, they'll promote pretty much anything, especially Floyd. He's crazy. Like, I've seen him promoting lawn products, bug sprays.

You just give him some money, and he does it.

Megyn Kelly
Oh, God. Even now, even post this.

Ray Trapani
I don't know. He's a crazy guy. I've just seen him promote some wild stuff on there, and I always just make jokes about, like, the amount of things that he's promoted. But I think if, like, he's selling boxing gloves, you should probably buy them. But I wouldn't take his financial advice.

Megyn Kelly
But, you know, it wasn't, of course, Johnny. It wasn't just those two celebs endorsing Centratech we saw in the Sam Bankman fried scandal. It was Tom Brady and Giselle and Larry David. Like, these celebrities, if the price is right, they sell out.

Johnny Be Good
Yeah. And I, and Ray has spoken on that before. First of all, like, with the Centratech thing, that was kind of before the, it was cool to do that because right afterwards is when all the celebrities started kind of doing that. And a lot of them did get in trouble. But the amount, the check that, like a normal commercial can offer you versus a crypto commercial is going to be like, vastly different.

And a lot of the celebrities, a lot of time, I don't really think they fully understand what they're promoting.

They're just like, sure. Like, big check. You guys are legitimate. Legitimate enough that you have, like, commercial spots on these big channels. Okay, I'll do it. Sure.

Ray Trapani
Yeah, that's, that's all it is, is that we, we just, the value proposition was just so much better in crypto because we just had, like, we knew that if Floyd Mayweather, we gave him a million dollars, we were going to make 5 million the next day. So we had the ability to do that. When you're a regular company that's promoting a product, I don't think Floyd Mayweather is going to bring you in that much money. So they aren't able to give him a million dollars. So that's why all these celebrities, right away, of course, they'll take these big checks to do a couple Instagram posts. It's the easiest thing I've ever heard for a million dollars.

Megyn Kelly
What's crazy is like, ok, I don't know about Floyd's situation, but you look at Tom Brady, he didn't need money. Gisele is even richer than Tom Brady is. She was, for a while, the highest paid supermodel in the world. Why would they take the risk? This is one of my questions, like, why would you take the risk with this cryptocurrency company like they did with Sam Bankman fried? But you're just saying it's just the easiest money ever.

Ray Trapani
It's. Besides it just being the easiest money ever, I think with the SBF one is a little bit more detailed because the public perception was so high of who he was, and he was donating to campaigns to every, both sides, right and left. And he just, he, no one thought it was gonna fall through. I mean, he, there was just too much. It seemed like it was too big to fail. And I think those big celebrities, he probably offered them massive money, like 5 million for just a one commercial, you know, that that probably took them like a few hours out of their lives or maybe even more than that. I think the amount of money those guys probably got for those commercials was crazy. I think they're actually, SBF is helping the government as of like two days ago. In regards to the celebrity endorsements, we'll.

Megyn Kelly
Continue to follow that one.

So Nathaniel Popper of the New York Times is legit and was onto the scent. But there were other guys who write about crypto who also were questioning whether you guys were legit and, you know, never to be daunted by somebody sniffing around.

You guys wound up buying a lot of those guys off.

I, maybe I'm not cynical enough, but, like, I'm amazed that somebody who's saying, hey, crypto world, watch out for Centra Tech. They don't seem legit. Could for, what, 20 grand, just completely flip and the next week be like, actually, I was wrong. They look good.

Ray Trapani
Is that what happened maybe 50 times? Like, not even, just like a couple of people. Every single one of the people that are promoting crypto, they all are just doing it, in it for greed, essentially.

It was the easiest thing I've ever seen. There was one guy that was the hardest one out of like 50 people that we just paid off. Either a few thousand, 5000, 10,000, whatever it took to get those taken down. And he, after about two weeks of saying no and continuing to make videos, he's like, ah, you know, my kid's a little sick.

Send me this. And we sent it to him and the next day, no applauding us.

Megyn Kelly
I'm Megyn Kelly, host of the Megyn Kelly show on Sirius XM. It's your home for open, honest and provocative conversations with the most interesting and important political, legal and cultural figures. Today you can catch the Megyn Kelly show on Triumph, a SiriusXM channel featuring lots of hosts you may know and probably love. Great people like Doctor Laura, Glenn Beck, Nancy Grace, Dave Ramsey, and yours truly, Megyn Kelly. You can stream the Megyn Kelly show on SiriusXM at home or anywhere you are. No car required. I do it all the time. I love the Sirius XM app. It has ad free music coverage of every major sport, comedy, talk, podcast and more. Subscribe now. Get your first three months for free.

Ray Trapani
Go to siriusxm.com mkshow to subscribe and give. Get three months free. That's siriusxm.com, mkshow, and get three months free offer details apply.

Megyn Kelly
One of the frauds that I think came about from Nathaniel Popper's investigation was the matter of the CEO.

So do you want to take that one, Johnny? The name of the CEO and how these guys found the CEO, Michael Edwards.

Johnny Be Good
Who, if you looked at his photo, looks strikingly like Ray's grandfather, was the fake CEO where you actually switched his photo out.

So, yeah, Michael Edwards was a fake CEO.

People were asking a lot of questions. Who are these guys?

Who is this Ray Trapani? These three guys from Long island, are they really experienced enough to run this crypto company? So Ray and sorby did what anyone would do, and they googled old white man and found the first photo, slapped it up on LinkedIn, slapped it up on the Centro website, said he went to Harvard also and called it a day. They had a brand new CEO with.

Megyn Kelly
Some legitimacy and called him a co founder of the company, too. But this house of cards, too, would crumble fantastically. And here's a little bit of that from the Netflix film Bitkand.

Ray Trapani
Hello, I'm Michael Edwards, founder and CEO of Centratech.

Is that who you really are?

No, that's not who I really am. I'm Doctor Andrew Haleko. I'm a professor at the University of Manitoba.

On August 25, Michael Edwards suddenly left this world. He leaves behind his french bulldog, Stanley, and an accomplished career as an investor and VP for Wells Fargo and Chase. He graduated with an MBA from Harvard University, which prepared him for his most recent venture as co founder and chief executive officer of Centratech in Miami Beach, Florida.

That's pretty creepy.

Wow. Well, at least I had an MBA and I was well trained at Harvard.

I hadn't realized that they had actually gone to that extent.

Michael Edwards was never even a real person.

Not at all.

We completely created him from scratch. The photos from Michael Edwards were just taken off Google. We just looked up old white guy, looked at all the images and found an old white guy and just took that image. And you know, that was Michael Edwards.

Megyn Kelly
Oh, my God. And then you killed him off Ray when the press was sniffing around with a. With an obit, a fake obit about his french bulldog, Stanley. The audacity. Who wrote the obit?

Ray Trapani
And the crazy thing is, that guy's, like the sweetest man in the world. I feel terrible for that guy. And he took it really well. Like, as far as. Like, I even seen him recently, like, on Twitter, like, promoting the documentary.

Johnny Be Good
Yeah.

Megyn Kelly
No way.

Ray Trapani
Yeah. So he's a. You know, I feel. I feel sorry for him, but it's a. You know, hopefully, he's not too upset about it at this point.

Johnny Be Good
I was actually shocked he. He did that scene because when we listened to Sorby's trial, there was, like, a dial in thing during COVID I I truly felt the worst for him out of, like, every victim, because he didn't invest anything. He's, like, teaching a class one day, and then, like, the mounties and the FBI roll up, and they're like, we need to talk to you.

And apparently, he's, like, the sweetest guy.

Megyn Kelly
Ever, so he seems pretty sweet. Who wrote the obit? Who came up with the french bulldog? Stanley? I'm just curious.

Ray Trapani
That's definitely a sorby thing. As soon as you hear french bulldog, I think of Sorby or Bert, if anything. Oh, my God. I was never a french bulldog guy.

Megyn Kelly
It's incredible. And now you need a new fake CEO, and this is where your grandpa comes in, your 79 year old grandpa. So you put his picture on there and a new profile fake for him. And not surprisingly, Nathaniel was not fooled and pretty soon unearthed the fact that this is your grandpa and not. Not another Harvard grad.

Ray Trapani
Yeah, no, I don't think we put him even as a Harvard grad. We use his real background, and we just put his real name as the CEO. So, like, essentially, I even asked him before I did it, which I. You know, I feel bad that I even had to. I even asked him, but it was a weird one because he was, like, on his deathbed at that point.

Megyn Kelly
Hmm. Okay, so. But he has no experience in this lane, so it was clearly just a figurehead that, you know, was meant to stave off further questions. It didn't work. And then, just as things are looking pretty dire, like, the New York Times is on to you. I think the New York Times piece had hit, and it was extremely unfavorable.

Like a.

Like the. Like the tech guy who mistook you for another company and wrote this favorable article, income the South Koreans, and resurrected Sentra tech for no good apparent reason. I don't understand it all, how they sniffed around and said, sure, I want in. So explain what happened with them.

Ray Trapani
Yeah, so even though the New York Times article was bad and people make it sound more dire than the situation was, no one started taking their money out. Everybody, because the price was being controlled on the back end by me, kept going up. Everybody was see that they'd be like, oh, the New York Times is just this is a hit piece. They were just like, no matter what would happen, as long as that price was going up, everybody stayed around.

Then the south korean thing comes about. They came into the chat rooms, and they're like, oh, we want to invest big money. And everybody says, big money. We're like, all right, yeah, sure. And they're like, you got to come to South Korea. And we're like, yeah, sure, we're definitely not going to South Korea. But then right away, they just send $5 million. We're like, oh, shit, I guess we'll go to South Korea. But I wasn't going to go. I was not going to South Korea. And sorby just jumps on a plane by himself and goes down there to present. Basically, we hadn't finished developing the app. The app was, like, in a prototype stage right there. At that point, it wasn't finished, but we basically connected it to our bank account so that if he swiped his card, it would look as if the app worked properly, but it didn't.

Megyn Kelly
He goes over to South Korea, he meets with these execs, and you're supposed to have this dazzling demo of an app that will at least look like it's working.

And it didn't.

Ray Trapani
Yeah, the. The app definitely didn't work. And then Sorby doesn't answer for about 8 hours there, or whatever amount of hours. And so I'm like, sorby died at that point. I was sure Sorby was dead.

Right, right, yeah. Because they had already invested 5 million. Right. So it's like, there's real pressure there. It's not like they can just be like, all right, whatever.

So then out of nowhere, he answers whatever amount of hours later, and he's just like, the app didn't work, but they still invested. And the only take that I could get from that is that that money was also criminal proceeds. And that's like a lot of cryptocurrency, is that they joined in on the fraud. Everybody, like, even the youtubers, right? They're all complicit, in a way, in this fraud. As much as we're the co founders and we're the reason for this fraud, if you're going to know something's a fraud, and then you're going to promote it, and then these guys see the app doesn't work, and they're still going to invest and take a lot of the percentage.

Everybody's complicit at that point.

Megyn Kelly
That is a very good point that actually, I hadn't even considered that until you just said, of course that's the reason. Why. Why. Why else would they give you. How much additional money did they give you after that initial? Five. And then the failed app speaker 110.

Ray Trapani
Another 1015 million total.

Megyn Kelly
Another ten. Oh, my God. You're right. That makes perfect sense.

So what leads to the downfall? How do we go from 15 million? Cash influx? Maybe we are going to be legitimate. We dodged the New York Times storm. We weathered it. What. What led to the implosion?

Ray Trapani
Yeah. So, pretty shortly after that, me and Sorby, I went and lied on the stand for Sorby in his DWI case. And I got a perjury charge for trying to lie on the stand for him. And after that, we were, like, put out a press release that we were stepping down from the company. Sorby stayed on. And basically, me and Sorby got in a really bad fight because I was still trying to pay back the debts that we had built for Miami exotics, even though we had all this money. I was like, all right, let's take some of this money and pay off these debts. And he was trying to not pay it. So I got, like, in a bad argument with him, and I left the company. So, like, people. What people don't realize is I never made any money from investor funds ever. Throughout this whole time, Sorby had those wallets himself.

And this is also why my sentence was what it was. It's just they highlight me in the documentary because of I'm the one in it. So I made all my money. I made all my money off selling sentra tokens myself after the fact.

Megyn Kelly
Hmm. Okay, so, but what? You lied in the DWI? Can I just ask? I know this is probably small ball after the frauds that we've been discussing, but was there any pause about lying on the stand? I don't. I'm a former lawyer, recovering lawyer. So I just always feel like, you take the oath to tell the truth, right? And then you lie like that. Had to be scary. I. What? Explain it.

Ray Trapani
Um, yeah, I mean, Sorby had this DWI from before. I even linked back up with him from years ago. It was, like, his 17th DWI, and he was gonna lose his license.

He asked me to do it. We flew to New York. I had never. I wasn't with him the day he got it. So we went to the restaurant where he had got this DWI. We kind of studied the room so I would have, like, the correct answers. His lawyer prepped me on what to say, basically, which is a crazy fact. Of the case, and I just kind of went up there and said what I was told to say, that he only had one class of Pinot Grigio. And from there, you know, pretty much got arrested shortly after that.

Megyn Kelly
What was the outcome of his drive?

Ray Trapani
Like, hard to do, but I was. I was, you know, under a lot of, you know, taking Xanax. I mean, I didn't feel hard at the time.

Megyn Kelly
Did he get off?

Ray Trapani
No, no, we. We both. He ended up getting charged for that. I don't know what his result. I think we both got charged a perjury. That was my. Ended up being my first felony.

Megyn Kelly
Oh, okay. And why do you say, johnny, this part drives you crazy?

Johnny Be Good
Because, I mean, you mentioned several times about how, like, well, everything seems so brash. Everything, like. Like, you know, the audacity of everything. Ray's and sorbee's, like, their weight for risk reward, it needs to be recalibrated. In my opinion. It's, like, so out of. There is no reason, you know, at this point, Ray's. Ray is business partners with sorby, but it's not like he necessarily likes him. So why? Why would you do that? And we've talked about this a lot, and the answer is, oh, why wouldn't I do it? Like, I know how to talk on the stand. Like, you know, I would do it for you. And I was like, that. It doesn't really compute, but Ray just has a very different, you know, weight of risk and reward.

Megyn Kelly
Have you ever met Jordan Belfort?

Ray Trapani
No. No. But the funny thing is, century started shortly after that movie came out.

Megyn Kelly
He's spectacular. I think he's an amazing guy. He's also brilliant and used his powers for evil and now is on the straight and narrow and is spousing a lot of lessons on it. You should definitely read his stuff and watch some of his podcasts, because there's probably some gold there for you to mine, too.

Ray Trapani
I definitely do. I do watch some of his podcasts. For sure.

Megyn Kelly
Yeah. Anyway, that. Your story is kind of reminding me of his, which is why I ask. So, all right, you've got to step down from the company. Things between you and so are you not good. And then is it the SEC letter that the company gets? That's the beginning of the end, because finally, the SEC was like, hmm, maybe we need to step in.

Ray Trapani
Yeah, for sure. So I had left the company, and Sorby was continuing on. And within, like, two months after me leaving, the SEC got involved. I was just in the deep end, just gambling hundreds of thousands of dollars every day. So when Sorby called me about the SEC, he was like, oh, just go meet with this lawyer. It's just the SEC. It's civil. And I was like, civil stuff? I mean, if it's just civil, I'm fine. You know, like, that's really not that scary.

And so I just met with the lawyer, and I was, they were like, well, you have a couple options here. You can cooperate. And I'm like, oh, what does it take to cooperate? And they tried to meet with me at that time, and I was just on way too many Xanax. They're like, well, you can't even form a sentence right now. So.

Megyn Kelly
So it's not going to be a great friendship yet. And by the way, speaking of attorneys, this is another strain of the story. That's crazy.

You at some point, did hire a lawyer to help Centratech.

Do what? Like, were you looking for somebody to help you cover up what you were doing or for somebody to help you straighten out?

Ray Trapani
Yeah. So what happened with that? It's early on in the company, there was a company that had got charged by the SEC for being a security, and we were just trying to find out if our company was a security. So Sorby had went on, I think he got found, this guy, on upwork, and funny enough, my lawyer right now, my criminal lawyer, I spoke to him the other day. He said, there's a guy trying to act as if it's him on upwork. That's really not him. So this must be like a common new scheme that people are doing. But, uh, yeah, this guy basically put out, like, his whole LinkedIn and everything that he worked, you know, like, as a big time lawyer for politicians and stuff. And Sorby hired him, paid him a.

Megyn Kelly
Couple, and was giving you legal advice. Like, you were, you were listening to his legal advice?

Johnny Be Good
Yeah.

Ray Trapani
He basically just told us, yeah, this is what we have to do to remain not a security. And we took his word for it for sure.

Megyn Kelly
And tell, tell us what happened with him.

Ray Trapani
He, once the SEC got involved, Sorby had said that was who we used as counsel. And because of that, he ended up getting arrested. And.

Yeah, now he, yeah, so he got arrested in charge, and I think he's out now.

Megyn Kelly
And it turned out he was a kid.

Ray Trapani
Yeah, yeah. It was just like some random young kid that was in college.

Megyn Kelly
He wasn't even a lawyer. He wasn't even, like, hadn't even graduated from college.

Ray Trapani
Yeah, he was a, he was like, students for Trump at the time in college, and he was doing this, like, on the side while he's, like, just playing video games and stuff.

Megyn Kelly
You must be a little disappointed in yourself that you didn't spot that particular con. Right. He was kind of conning you.

Ray Trapani
Yeah, I never spoke to him. Sorry. We did. But, yeah, he definitely got us. He was.

Johnny Be Good
I think Ray's reaction to it is more like, well, that was a good one.

Megyn Kelly
Yeah, yeah.

Ray Trapani
I don't like, I don't take, like, I'm not like, oh, this guy got us. Like, we got to get him back. I mean, it is what it is. We were doing, you know, scammy stuff, and he did the same.

Yeah, that one over on us.

Johnny Be Good
Yeah.

Ray Trapani
I guess, like, it's not like a respect. I'm not, like, proud of him, but it's.

Megyn Kelly
Again. But they're very audacious. Who pretends they're a lawyer and starts giving advice to a crypto company on whether they're a security. Security. That's really bold. Again, all these guys out there who could be using these talents for good. All right, so long story short, you wind up cutting a deal with the government because it did. It did turn criminal, and you get time served. So did you serve any time while awaiting that final negotiated settlement?

Ray Trapani
I did about five days in. In Florida when I first got arrested, and then they released me to rehab. I did, like, a 30 day rehab, and I was on house arrest for about a year. And. No, besides that, that was my time served.

Megyn Kelly
Did the government want you to get more than time served?

Ray Trapani
No, no, they didn't think I.

Megyn Kelly
They were filing it.

Ray Trapani
Like. Like, how they break that down is what people don't realize is they really believed that I was never going to commit another crime. And I think, in my opinion, that the government is smart. I don't think that they're just, like, out of pocket. Like, oh, he helped us so much, we should give him no time. It was that they truly believed that I wasn't going to be out there committing any more crimes. And I think that's how they gauge it as far as with sorby, they felt that it was definitely likely, if they gave him less time, that he would come back out and do more crimes. And I, you know, I happen. I happen to agree with the government.

Megyn Kelly
He went away for eight years and is still in prison right now.

Ray Trapani
Correct.

Megyn Kelly
And Farkas got one year.

Ray Trapani
Yeah, he did about eight months.

Megyn Kelly
Am I wrong in thinking that this judge who wound up sentencing you was, like, a little swoony? I mean, I was hearing what she said to you. I'm like, what's the matter? She sounds like a schoolgirl who has a crush and not like a judge sentencing a felon.

Ray Trapani
So that's the part, is that I helped the GU. The government. I don't know why they considered me better than other cooperatives that they've dealt with in the past.

I was very honest. And then during that time, I also got married, had kids, and I became a drug counselor for about three years leading up into my sentencing. And sorby, on the other hand, was breaking curfew, going to strip clubs. So it's like, there was a pretty clear reason why, in my opinion, that I got time served. And then all my. The money that I made, I owe in restitution. So I pay that monthly. So it's like.

I hear what you're saying as far as like.

But that's just what the government's recommendation. It wasn't the judge. The judge, they cut out a small snippet of what the judge was saying to me. She gave me a hard time at first.

And it was just basically that the cooperation was essentially better than what they typically have as a cooperator.

Megyn Kelly
Hmm. Okay, so what about the victims? Because, you know, we've been laughing, and there's some aspects of the story. They're just so sort of extraordinary. You can only laugh. But in this case, as with Sam Bankman fried, there are people who actually got hurt, and they're gonna watch this, and they're gonna wanna know what you have to say to them.

Ray Trapani
Yeah, no, absolutely. And out of everything, that's the one thing that I truly regret the most, is that people lost money.

They also have.

We were charged with a $32 million fraud. They have 33.5 million to give back. The only reason that the money has been held up is because there's a class action suit to try to be able to control how the distribution works. So there's more money than we were charged with in seized assets.

Megyn Kelly
That's actually also like Sam Bankman fried. Most of his victims maybe all got repaid, but the allegation in court was they could have earned more on that money had it been invested in the way they thought it was being invested. I mean, is that parallel to your case, too?

Ray Trapani
Yeah, exactly. And that was one of Sharma's main arguments as well, is that you've never seen a fraud like this where there was more money seized than actually raise. You know, so it's like a. It's a weird case in that regard, and I honestly haven't even met anybody that's, like, lost money. I really don't. I don't know, and I'm sorry to whoever did lose money.

Megyn Kelly
Hmm. So this was all wrapped up in 2018?

Ray Trapani
Yes, 2018.

Megyn Kelly
Okay. And now what? Like, you know, you're. You married? Is it true you met your wife with your ankle bracelet on?

Ray Trapani
Yes, I did meet my wife. My ankle bracelet on. I was.

Megyn Kelly
Oh, my God.

Ray Trapani
Yeah. I actually just was allowed curfew. Like, you know, at first I was in house arrest, full of house rest, and then I went out when I first got my ankle, my curfew is a smaller ankle bracelet, so it wasn't the big one, but, yeah, I mean.

Megyn Kelly
You had to do, like, a year on house arrest.

Ray Trapani
Yeah. I was also like, I don't know, not everybody cares that much. Like, if you're honest about what your past was and why you have that ankle brace, and it wasn't like I was trying to hide it. I was making, you know, like, jokes about it. Right. And then I. I don't know, just pretty much fell in love pretty quick there.

She's. She's a great Johnny.

Megyn Kelly
Is it.

Is it a good match? Do you see why she overlooked Ray's past?

Johnny Be Good
Yeah, I totally kind of get why. Ray's very honest about who he is, and I think that's a big part of, like, the draw, and I think it comes across as genuine. And you kind of tend to, especially when you're talking to him and, like, he's. He's being so honest and. And open with everything, you kind of just tend to forget about that, and you're just talking to, like, a charismatic person. So I could kind of see how. How that happened.

Megyn Kelly
Do you think he's gonna.

Do you think he's gonna stay on us on the straight and narrow, like, if you had to bet?

Johnny Be Good
So we. I. We talk about this a little bit at the end of the podcast where Ray and I were, like, we went out to atlantic beach, and we were sitting there, and, you know, there's a big test coming up. Ray's eventually going to get off probation, and then he's not going to have these, like, courtesy mandated drug tests. I actually lived with Ray the last time he got off probation and didn't have court mandated drug tests. And after three years or something of being sober, he was back on drugs in, like, a week or something like that. And I. There's always that fear there, and, you know, we could just take it day by day. I don't think it's going to happen. And I think he's in, like, such a good place mentally now compared to where he was earlier in his life, that I'm less worried, but it's still a worry.

Megyn Kelly
What are you doing for a living now, Ray?

Ray Trapani
Me? I mean, I'm trying to write a book, did a podcast, and I'm trying to start a new business now, I'm afraid.

Megyn Kelly
What is it?

Ray Trapani
Just like web development. I mean, I'll definitely never do another crime like web development company.

Megyn Kelly
So talk to me about how you know that. Because in other interviews I've done with criminals, especially those who spend a life doing frauds, they talk about the adrenaline rush from doing it and how that is something that is hard in the way a drug addict wants the rush of the drug.

You know, some of these criminals need the rush of the adrenaline. They, like, they really like and are addicted to living life on the edge.

Ray Trapani
Yeah, for sure. But I also was 24, 25 when I was doing these crimes, and now I'm 33, and I've had a massive adrenaline dump after, like, this all happened.

Johnny Be Good
Right.

Ray Trapani
And then, so, like, I think when you're sober for a certain amount of time, that's one thing that this, like, I speak about this a lot is this case saved my life. Like, if I wasn't arrested there, I was dead within probably the next couple months. I was spending all my money gambling. Millions of dollars a month. I was gonna be. As soon as I went broke, I would have definitely been dead.

So the case saved my life. That's why I'm grateful for, like, how this all played out, obviously, especially with, like, the no time sentence and where my life is today.

Wait, I forgot my. The original question.

Megyn Kelly
Just whether you need the adrenaline of the crime and whether that's gonna be a tough habit to break.

Ray Trapani
No, I don't think so. I think just, like, off drugs, it's pretty easy to not commit crimes and do the right thing. Um, I think as long as I stay sober, there's no worry to society.

Megyn Kelly
Have you gotten any therapy? I mean, I don't want to blame it all on childhood trauma, but it does seem like it's an obvious suspect for why you wound up making these choices.

Ray Trapani
Uh, yeah, I've done therapy. Um, I did a ton of, like, uh, drug counseling, and then I became a drug counselor throughout this time, and working with other people that had sexual abuse, like, uh, drama, kind of helped me a lot. Just kind of seeing, I don't know, I feel like I'm a weird person. Because I compartmentalize it, or whatever it may be.

But there's people that, like, in their fifties, and they're still crying about it every day, and I don't know, I couldn't find a way to, like, break them through it. And I feel like it doesn't hold any weight now that I've talked about it openly.

That's great.

Megyn Kelly
That's a. That's great.

Ray Trapani
I think I'm in a very good place.

Megyn Kelly
Great skill.

No, I completely believe in compartmentalization. If you can do it, lean in. So I'm just curious. What's your wife's name?

Ray Trapani
Kim.

Kimberly.

Megyn Kelly
So when you and Kim go to parties and you meet new people, how do you work this into the conversation? Like, ah, so, right. How do you let people know this is part of your story?

Ray Trapani
I just tell everybody pretty openly. I don't.

People that meet me, they all are like, oh, he's actually a nice guy.

Most people think when they meet you, they don't know.

Megyn Kelly
So, I mean, like, then there's the big reveal.

Johnny Be Good
Yeah.

Ray Trapani
I just kind of tell them my full story. I, like, don't hide it at all. It's like, I'm like, yeah, I had a company, and then I got in trouble down in Miami, and they're like, oh, what'd you do? And I, like, I had a cryptocurrency company. We raised, you know, some money, and we got in trouble. It's. And. And then, like, they just, you know, whatever is he's telling us, telling him the truth.

Megyn Kelly
All right, I gotta tell you something. My husband and I, not long ago, went to this dinner party, and there were maybe 14 people there. And we played a game, per the host, where he asked all of us to write down on a piece of paper something. Some interesting or fun fact about ourselves without, like, the host would know who. No, the host wouldn't know. Nobody would know who it was. So you didn't write your name on the card. Then the host takes all the folded up pieces of paper, and the host reads one after the other, and he reads one, and then everybody at the table votes on who at the table they think this fact or story belongs to. And the stories were crazy. Some were tame, like a woman who used to play the tuba in a marching band, or it was like, whatever. And then some were actually bizarre. Like, I had two wives at the same time. You know, this is the greatest game ever for you, with your friends who don't know this story and haven't watched Netflix or listened to the pod am I wrong? I mean, I think you need to do it.

Ray Trapani
Yeah, I mean, I don't know who I would play it with, but. Sounds fun.

Megyn Kelly
You got to get people like me who didn't know anything about this until my team brought your story to me. Listen, I wish you all the best, and let me give the podcast another promo. Give me the name again. What is it called again, Johnny?

Johnny Be Good
Creating a con, the story of bitcond.

Megyn Kelly
All right. Creating a con, the story of bitcond. And it's you two together going through the gory details of all of this. I wish you all the best. I hope things go very well for you in the. In the white hat. Lane and Johnny, to you, as well. Thanks for coming on and telling the story.

Johnny Be Good
Thank you so much. Appreciate it.

Ray Trapani
Thank you so much.

Megyn Kelly
We'll stay on this story, and we'll definitely get Ray connected with Jordan Belfort. Can't wait to see where that goes. Meantime, I want to tell you that tomorrow we have two guests on who escaped a dark and dangerous cult and one that had a particular fraud angle to it. We dive into NXiVm with some new developments about this thing next. See you then.

Thanks for listening to the Megyn Kelly show. No B's, no agenda, and no fear.

Fraud Week: How Crypto Convict Made Millions Before Getting Caught, with Ray Trapani and Jonny B Good | Ep. 816

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1: Early Life and Troubles

2: Founding of Centratech

3: The Downfall

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