A Santa Cruz man has been indicted on four counts of wire fraud following allegations that he misled investors about his software company and a music streaming service. Hank Risan, 70, was arrested and appeared in federal court in San Jose after a grand jury returned the indictment on July 31, 2025.
Prosecutors allege that Risan offered and sold stock and stock conversion in Media Rights Technologies, Inc. (MRT) and BlueBeat, Inc., making several false claims to investors. According to the indictment, these included statements about BlueBeat’s copyright ownership of approximately 2.5 million songs by well-known artists, misleading valuations of BlueBeat, assertions of an imminent acquisition by a large media conglomerate, and claims involving a former undersecretary of the U.S. Department of Commerce.
An example cited in the indictment described Risan telling investors on Nov. 3, 2020: “I received a very favorable comparable regarding the BlueBeat Catalog” and “To put that news in perspective, BlueBeat contains approximately 2.5 million songs and $10K per song brings music to my ears. You can do the math!”
Authorities state that these representations were not true; BlueBeat did not own copyrights for the claimed catalog size, company valuations were fabricated, there was no pending acquisition by any media conglomerate, and the former Commerce official had no involvement with BlueBeat.
The indictment alleges that Risan convinced investors to purchase roughly $1.96 million in stock or conversions and make additional payments called “loans.” In total, he is accused of obtaining about $3.17 million through this scheme. Prosecutors say Risan used these funds for personal expenses such as credit card payments, buying collectibles, and paying his home mortgage.
United States Attorney Craig H. Missakian stated: “Risan was released on a $100,000 unsecured bond.” FBI Special Agent in Charge Sanjay Virmani joined Missakian in announcing the charges.
Risan is scheduled for a status conference before U.S. District Judge P. Casey Pitts on Oct. 8, 2025.
Officials emphasized: “An indictment merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt.” If convicted on all counts of wire fraud under 18 U.S.C §1343, Risan faces up to 20 years’ imprisonment per count along with fines up to $250,000 each count; sentencing would follow guidelines set forth by federal statute.
Assistant U.S. Attorneys Matthew Chang and Jeff Nedrow are prosecuting with help from Natachiana Burney and Susan Kreider; the case is being investigated by the FBI.
