Former executive of defunct satellite start-up pleads guilty in $250 million fraud case

Date: Jan. 20, 2026

Contact: newsroom@ci.irs.gov

WASHINGTON – Joseph Fargnoli of Rochester, New York, pleaded guilty today in U.S. District Court in connection with his role in a multi-year scheme to defraud investors and lenders out of approximately $250 million, announced U.S. Attorney Jeanine Ferris Pirro.

Fargnoli is one of five former principals of the now-defunct Theia Group, a DC-based aerospace start-up company. He pleaded guilty today to one count of wire fraud before Judge Royce C. Lamberth.

Fargnoli, who served as Theia Group’s Chief Technology Officer, is the first defendant to plead guilty in the case. The four additional Theia Group defendants include executives Erlend Olson, John Gallagher, Stephen Buscher, and Jamil Swati, who each face similar charges. Olson is additionally charged with evading more than $3.9 million in personal federal income taxes.

According to court documents, Theia planned to launch 112 satellites starting in 2022 at a cost of $10 billion to $15 billion. Theia’s principals originally planned to raise the requisite funds from various nation-states by promising perpetual data and analytics for an upfront cost of $2 billion. However, from Theia’s founding in 2015 through its placement into receivership in 2021, Theia was unsuccessful in obtaining any funding from nation-states. Instead, Theia obtained approximately $250 million in loans and investments that Theia’s principals induced by fraud.

The fraud scheme allegedly included materially false statements about revenue from non-existent government contracts, provision of multiple false financial statements, including a fake $6 billion escrow account statement, and false representations about Theia’s technical capabilities.

This case is being investigated by the Justice Department’s Tax Division, the Internal Revenue Service Criminal Investigation (IRS-CI) Washington D.C. Office, and the Federal Deposit Insurance Corporation (FDIC) Office of Inspector General.

The matter is being prosecuted by Assistant U.S. Attorneys Rebecca G. Ross and Jolie F. Zimmerman and Trial Attorney Alexis Hughes of the Tax Division.

IRS Criminal Investigation (IRS-CI) is the law enforcement arm of the IRS, responsible for conducting financial crime investigations, including tax fraud, narcotics trafficking, money laundering, public corruption, healthcare fraud, identity theft and more. IRS-CI special agents are the only federal law enforcement agents with investigative jurisdiction over violations of the Internal Revenue Code, obtaining a 90% federal conviction rate. The agency has 19 field offices located across the U.S. and 14 attaché posts abroad.