Founder of Rancho Cordova biotech startup firm pleads guilty to securities fraud
08/06/2014 6:02 PM
08/06/2014 6:04 PM
The founder of Rancho Cordova-based Telomolecular Corp. has pleaded guilty to securities fraud.
Matthew Sarad, 40, of Bakersfield entered the plea Wednesday in federal court in Sacramento, according to a federal Department of Justice news release.
Sarad lived in Folsom and was the founder and chief executive officer of Telomolecular Corp., which purported to be a biotechnology startup company. The firm claimed to have developed nonoparticle technology that could eradicate cancer and treat other age-related diseases, according to court documents. Between November 2005 and July 2008, Sarad solicited investors nationwide, offering them stock in Telemolecular. In selling the stock, Sarad made untrue statements, such as telling investors that the company believed its cancer curing products would complete clinical trials, obtain required government approval and make it to the market in less than three years, and that the firm had a deep management team with experience taking companies public. Sarad collected about $6.5 million from more than 300 investors, authorities said.
In addition, according to court documents, between January and December 2009, Sarad owned Folsom-based Sun Nanosystems. The firm purported to install solar energy systems for residential and commercial customers. It claimed to have developed nanoparticle technology that vastly increased the efficiency of solar panels.
In selling the solar panels, Sarad falsely told customers and prospective customers that Sun Nanosystems worked with state-of-the-art proprietary technology that could increase the efficiency of conventional solar panels by as much as 50 percent. He claimed that Sun Nanosystems had a great deal of experience installing solar panels and had satisfied past customers. Authorities said Sarad collected approximately $300,000 from customers but failed to complete installation of any solar panels.
Sarad is to be sentenced Nov. 19 by U.S. District Judge Kimberly J. Mueller.
The case resulted from an investigation by the Federal Bureau of Investigation.
Sacto 911 StaffBill Lindelof
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