Matthew Sarad of Bakersfield, California, the founder and former CEO of Telomolecular Corp., pleaded guilty to securities fraud on Wednesday in a Sacramento federal court. Telomolecular Corp. was professed to be a biotechnology startup company that claimed to have developed nanoparticle technology that could eradicate cancer and treat other age-related diseases.
From November 2005 to July 2008, Sarad solicited investors from across the country offering stock in Telomolecular, misrepresenting the stock in the process. According to court documents, Sarad would tell investors that the company's cancer-curing products would complete trials, obtain required government approval, and make it to the market in less than three years. He also said his firm had a deep management team with experience taking companies public. Throughout the process, he collected about $6.5 million from more than 300 investors.
From January to December 2009, Sarad also owned Sun Nanosystems out of Fulsom, California. Sun Nanosystems professed to install solar energy systems for residential and commercial customers and claimed to have developed nanoparticle technology that greatly increased the efficiency of solar panels. Sarad told customers that the company worked with state-of-the-art proprietary technology that could increase the efficiency of standard solar panels by as much as fifty percent and that the company was experienced in installing solar panels and had satisfied customers. Sarad collected about $300,000 from customers but never installed a single solar panel.
Sarad will be sentenced November 19 by U.S. District Judge Kimberly J. Mueller.