The former CEOs of Bitwise Industries learned their fate for defrauding tech investors $115 million on Tuesday morning at the downtown Fresno federal courthouse.

Jake Soberal received a sentence of 132 months, or 11 years. Irma Olguin Jr. was sentenced to 108 months, or nine years.

John Coughenour, a visiting judge from Seattle, said the difference in sentences was because Soberal was a licensed lawyer at the time of the fraud crimes while Olguin was an engineer. The judge said lawyers have a sense of responsibility, and called Soberal’s behavior “very troublesome.”

Soberal has since been ruled ineligible from practicing law.

Coughenour said he based his sentencing also on what Elizabeth Holmes received in the Theranos case. Judge Edward Davila —who Coughenour said was a colleague — sentenced Holmes to 135 months.

Olguin, 44, and Soberal, 38, were ordered to surrender to federal authorities to begin their sentences by March 18. While the judge did not assign federal prisons, Soberal’s attorneys asked he serve in Lompoc; Olguin requested Victorville.

Neither Soberal nor Olguin commented on their sentences as they exited the courtroom and headed to the pretrial services office. The U.S. marshals office escorted them away from the courthouse outside the view of the gathering media in front.

Their family members also declined to comment after the sentencing.

Prosecutors accused Olguin and Soberal of lying to investors and forging financial records to keep the company afloat. Soberal and Olguin pleaded guilty to two wire fraud accounts each last July.

Packed Courtroom Hears Apologies

Spectators filled very seat in the Courtroom 5 gallery, including several standing. More than 100 came to witness Soberal and Olguin apologize to the court, and to the community.

Lawyers for the defendants felt 60 months, or five years, would be a fair sentence. The government asked for 151 months — 12 and half years.

Soberal spoke to the judge first. Wearing a suit, and partially grown beard, he apologized several times, reflecting on his conduct.

“My dishonesty created this pain and suffering,” Soberal said.

He justified his actions as an effort to save the company from its financial failures. He and Olguin said they did not financially benefit from bilking investors.

Serving 11 years will take Soberal away from his three children.

“Your father has sinned and lied, and it is not okay,” Soberal said.

Soberal admitted enjoying the power and influence running Bitwise. Prosecutor Joe Barton used those words against Soberal in his rebuttal. He said Soberal “weaponized” doing good, by preying upon investors.

“He must face the consequences,” Barton said.

Olguin, with fuchsia hair and wearing a pantsuit, also apologized. She sobbed at times, speaking to the judge.

“I’m sorry I betrayed your trust. I’m sorry I broke your heart,” she said.

Olguin called her life — from the fields of Caruthers in poverty, to a celebrated tech CEO — “Hallmark movie” worthy.

She is concerned that her actions may reflect poorly on Mexican-Americans, the queer community, and women.

“I let them all down,” Olguin said. “I fear I dragged them down with me.”

Victims Testify

Soberal stood sober-faced hearing from four victims of his financial crimes.

Brian Maxwell of CA Ag said Bitwise bilked him for $1.6 million. He compared his meetings with Soberal to his niece’s fantasy tea parties. The losses affected Maxwell and his wife from making a down payment on a new home.

Referring to Soberal’s several references to his faith, Maxwell said “Is it Christlike to steal from my mom?”

Brian’s father, Jim Maxwell of Agri Capital, also testified. He said Bitwise took advantage of local investors who wanted to do good for local businesses. He is concerned how that may affect legitimate businesses seeking finances in the future.

“Entrepreneurs now face suspicions and closed doors,” Maxwell said.

Kennan Scott, a former Bitwise vice president, said his experience left him without income and without savings. He testified Soberal and Olguin convinced him to invest his own money into the sinking company. He said the pair “upended” his family’s future.

Luke Hewko, an accountant who examined Bitwise’s financial records, said fraud dated back to at least 2018. He said the company spent outrageous salaries for “friends, family and lovers.”

Olguin’s sister Sandi Olguin, and brother Santana Olguin both had Bitwise jobs. Both attended the sentencing hearing. They had no comment about whether their Bitwise careers were aided by nepotism.

Unlike prior court hearings for Olguin and Soberal, the defendants did not face jeers nor scorn while walking in and out of court.

Laura Splotch, a former Bitwise employee, attended the hearing, as she has done several times in the last 18 months.

“I think they should have had more time thrown at them. I’m happy that they’re going away for as long as they are. But I really think that the amount of damage they did to most of us … nothing would have made me happier than to see them go away for good,” Splotch said after the hearing.

The Bitwise Legacy

The tech and real estate startup based in Fresno won acclaim from the business and social equity world for the company’s mission to hire and bring tech training to the unserved.

Soberal and Olguin earned recognition, not only from the social equity investors they convinced to give money, but from the tech and governmental worlds as well.

At one point, Gov. Gavin Newsom appointed Olguin to the state’s community college board.

But the idealistic plans ran into financial realities. With a starting salary of $70,000 for every employee, Bitwise could not make payroll, nor pay its property taxes, as GV Wire reported when it broke the story in May 2023.

The government accused Bitwise of using forged documents to induce loans from several investors. Olguin and Soberal also lied to their own board of directors, painting an optimistic financial picture instead of the impending doom.

Former employees recently won a $20 million class action settlement, mainly paid for the remaining insurance of Bitwise and its board of directors.

In a bit of courtroom levity, as Jim Maxwell testified, he said he is 75 and still working. Coughenour interjected, saying he is 83 and working right now.

Noting Maxwell was a farmer dressed in a suit, the judge relayed a story of catching the last car rental out of Portland, and driving to Seattle. The man behind him asked for a ride as well, which Coughenour agreed. In a suit, the man said he was a farmer. He turned out to be Baron Philippe de Rothschild.

Related Story: What Is Justice in the Bitwise Case? 5 Years or 12 Years in Prison for CEOs?

Family Leaving the Courthouse