Two young founders of a cryptocurrency debit card company, which used undefeated pugilist Floyd Mayweather to promote its initial coin offering, were recently indicted on perjury charges. The charges are related to a drunk driving case and are unrelated to the company.

According to the New York Times, Sam Sharma and Raymond Trapani, co-founders of Florida-based startup Centra, were indicted by a Manhattan grand jury on October 5 for allegedly lying to authorities during a trial regarding Sharma's March 2016 arrest for driving while intoxicated in New York's Meatpacking District.

Sharma told the Times that he couldn't talk about the perjury charges, but said that investors do not need to worry about his legal issues.

Sharma also has a trail of other legal and business-related disputes, the Times found. Sharma was evicted from two apartments for not paying rent and has been sued in Florida and New York multiple times for business deals gone bad and unpaid debts.

Centra pitched its token sale, which launched on September 19 and closed on October 5, as a way for buyers to get on the ground floor of a new virtual currency debit card. Mayweather and musician and social media star DJ Khaled were paid to promote the initial coin offering on Facebook, Instagram, and Twitter. Mayweather and DJ Khaled posted pictures of themselves holding a metal Centra debit card emblazoned with the Visa logo.

In a second social media promotion, Mayweather posted a photo of himself admiring his boxing title belts laid out on a pool table. "Centra's (CTR) ICO starts in a few hours. Get yours before they sell out, I got mine," Mayweather wrote in the promotional tweet.

The initial coin offering, thanks in part to Mayweather and DJ Khaled, raised $30 million from investors. In exchange for money, investors received the company's digital token. But, according to the Times, Centra, like many other companies that sell their own virtual currencies backed by nothing more than an entrepreneur's promise and a white paper, seems to be plagued with problems.

The company marketed its debit card as a way for people to spend virtual currencies anywhere Visa is accepted. But, Centra had not been approved to use the Visa network, a spokeswoman for Visa told the Times. After removing any mention of Visa from its website, Sharma said that the company would use Mastercard's payment rails by partnering with a Canadian financial firm. (Mastercard said that Centra has not applied, or approved, to use its network.)

Despite the hitches with Visa and Mastercard, Sharma told the Times that they would issue cards this year.

Centra's problems started before the company launch its ICO. In August, a programmer discovered that the company's CEO, a man named Michael Edwards, was not a real person. (Michael Edwards even had a fake LinkedIn account, touting his employment at Bank of America.) Sharma and Trapani told the Times that a freelancer hired to write the marketing materials made a mistake.

In July, the U.S. Security and Exchange Commission warned investors about "improper" ICO schemes and issued rules on how startups can decide whether or not they are selling securities, or utility tokens, and if they need to register with the SEC.

Well-known tech investors have issued warnings. Fred Wilson, founder of Union Square Ventures, wrote on his blog in June that he is "bullish" on cryptocurrency, but he says the space is very risky--"buyer beware," Wilson wrote.

Despite the risk, many investors see the volatile cryptocurrency markets as a way to make big profits. According to, which tracks ICOs, almost 300 companies have raised $3.2 million through initial coin offerings this year. Most of the ICOs are for projects that do not have an existing product, or operating history. 

The unregulated fundraising tool allows companies to create and sell their own virtual token with little to no oversight, creating what Scott Robinson, the co-founder of Plug and Play's bitcoin startup accelerator, calls a "wild west." He said investors and entrepreneurs should look at ICOs the same way you'd view a slot machine at a casino. 

But, as long as there are people willing to buy digital tokens during ICOs, some startups will use the star power and the social media followings of celebrities to promote their funding raising events. Hip-hop artist The Game and hotel heiress Paris Hilton have also promoted initial coin offerings.

Peter Van Valkenburgh, the director of research at Coin Center, a bitcoin and cryptocurrency nonprofit, tells the Times that celebrity endorsed ICOs should be scrutinized.

"It's undeniable that a celebrity endorsement brings a new audience into the world of crypto currencies," said Van Valkenburgh. "But I'm not certain that celebrity endorsements are doing a good job of bringing attention to the legitimate projects."