A group of former executives from aerospace start-up Theia Group Inc. have been charged with conspiracy and fraud after allegedly deceiving investors and lenders out of a staggering $250 million. The company, based in Washington, D.C., once promised to launch over 100 satellites into space. However, according to authorities, it was all built on lies.
Theia Group, founded in 2015, planned to send 112 satellites into orbit by 2022. The cost of this ambitious project was estimated at $10 billion to $15 billion. The company’s executives—Erlend Olson, John Gallagher, Stephen Buscher, Joseph Fargnoli, and Jamil Swati—allegedly sought to raise money by promising governments around the world special access to data in exchange for billions of dollars in funding. But from the time of its creation until it was placed under financial supervision in 2021, Theia was unable to secure these massive funds. Instead, it reportedly only managed to collect about $250 million from investors and lenders.
A Web of False Promises
To get the money, Olson, Gallagher, Buscher, Fargnoli, and Swati are accused of telling multiple lies. According to the indictment, they made up stories about huge government contracts that did not exist. They also created fake financial records, including a completely bogus $6 billion escrow account. These false statements convinced investors that Theia was more successful and financially secure than it really was.
The company also claimed to have cutting-edge technology that, in reality, was not functional. Investors were led to believe that Theia had groundbreaking advancements, but these promises turned out to be empty.
Authorities say the fraudulent scheme went on for years. The executives kept up the deception by repeatedly providing false information and misleading reports. This allowed them to keep bringing in money from unsuspecting investors who believed they were funding a revolutionary space project.
Personal Gain at the Cost of Others
Erlend Olson, the former CEO, has also been charged with tax evasion. Authorities say he owed the IRS more than a million dollars in taxes, penalties, and interest from as far back as 2009. Instead of paying off his debt, he allegedly found a sneaky way to hide his earnings.
According to the indictment, Olson set up a fake business to collect his salary. Instead of receiving his paycheck directly, his earnings were funneled into this fake company. He then used the money to fund a lavish lifestyle, paying for things like a private jet membership, expensive rent, a Land Rover, personal debts, and even multiple condominiums in Las Vegas.
By doing this, he not only avoided paying his past tax debt but also managed to dodge taxes on his earnings from 2018 to 2020. Now, authorities say he owes the IRS even more—an estimated $1.6 million just from those years alone.
Serious Charges and Possible Punishment
Olson, Gallagher, Buscher, Fargnoli, and Swati now face serious legal trouble. They have been charged with conspiracy to commit fraud, as well as multiple counts of wire and mail fraud. Wire fraud and mail fraud happen when people use phones, emails, or mail services to deceive others for financial gain.
Each fraud charge carries a potential 20-year prison sentence. Since the executives face multiple charges, they could be looking at long prison terms if convicted. In addition, Olson faces separate charges of attempted tax evasion, with each count carrying a maximum of five years in prison.
If found guilty, they will also have to pay financial penalties, give back the money they took, and spend time under supervised release after serving their sentences.
This case was investigated by the IRS and the Federal Deposit Insurance Corporation’s Office of Inspector General. Prosecutors from the Justice Department’s Tax Division and the U.S. Attorney’s Office in Washington, D.C., are handling the case.
It is important to remember that an indictment is not a conviction. The accused executives are presumed innocent unless they are proven guilty in court. The legal process will now determine their fate.
