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Charleston-based technology company Micfo LLC and its founder and CEO are facing federal fraud charges. File/Andrew J. Whitaker/Staff

The chief executive of a Charleston technology company will be allowed to continue traveling overseas to run the business after being indicted on wire fraud charges, a federal judge ruled Monday. 

Amir Golestan, founder and CEO of Micfo LLC, appeared in federal court for the first time Monday after he and the company were charged in mid-May. He pleaded not guilty.

After attorneys for the government asked U.S. Magistrate Judge Mary Gordon Baker to take away Golestan's passport, she decided Golestan had enough reasons to leave the country as part of his job. 

"I'm putting my faith in you that you're not going to evade this prosecution by staying in a foreign country," Baker told Golestan. 

Golestan said little during his arraignment, beyond acknowledging he understood the questions he was asked. He pleaded not guilty to defrauding the American Registry for Internet Numbers, a nonprofit in charge of distributing so-called Internet protocol addresses.

The addresses are strings of numbers required for any device that connects to the Internet. They have become a commodity in recent years, because only about 4 billion combinations exist and the transition to a new system is years away. Some brokers have taken advantage of their scarcity by buying the numbers under false pretenses and reselling them.

The market price for a single address is anywhere from $13 to $19. 

According to the indictment, Golestan and Micfo created an elaborate network of fictional executives and bogus corporate websites to lead the registry into thinking they were separate, independent companies. Once the numbers were allocated, some were resold.

The alleged fraud went on for about five years and its value has been estimated between $9.9 million and $14.4 million, according to the prosecutors.

At Monday's hearing, defense attorney Bart Daniel said two senior officers in the Micfo executive suite have left the company, leaving Golestan with little choice but to continue traveling overseas. Baker agreed, but she ordered the CEO to check in with a probation officer every time he plans to travel. She also told him to limit his travels as much as possible.

She assigned a $500,000 unsecured bond to Golestan, who has no past criminal history.

"We're looking forward to our day in court so we can clear his good name," Daniel said after the arraignment hearing.

Golestan had been aware of the government's investigation for months, lawyers said. In arguing to strip him of his passport, assistant U.S. attorney Nathan Stuart Williams said the Mifco CEO didn't think he'd be charged.

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"He thought he would evade the civil process and criminal indictments," Williams said. 

It was an unexpected turn of events for the business, which was established 20 years ago in Dubai and is now headquartered on East Bay Street, near the City Market. According to its website, Micfo owns dozens of data centers across the world and provides cloud-based technology services to customers in 90 countries.

The indictment came a few months after Micfo sued the numbers registry to stop it from clawing back the addresses the company hadn't already sold. 

The registry had caught on to a scheme and asked Micfo last year to provide proof of its customer lists, inventory, tax filings and more.

Micfo resisted and took legal action. It also said revoking the addresses would cause “insurmountable damage" to the core of the business. The case was dismissed in January, and Micfo was ordered to pay the registry $350,000 in legal fees.

During the proceedings, Stephen Ryan, the registry's  attorney, told a judge in December that Golestan had a pattern of defrauding the registry, according to a court transcript.

"I have never in 38 years seen somebody come into a court of equity with as unclean a set of hands," Ryan said.

Reach Mary Katherine Wildeman at 843-937-5594. Follow her on Twitter @mkwildeman.