Nevin Shetty Faces Charges

Former chief financial officer (CFO) of a Seattle startup, Nevin Shetty, was charged with wire fraud on May 17 in the United States District Court in Seattle.

According to the indictment, Shetty, 39, diverted approximately $35 million from the startup’s coffers to a cryptocurrency platform under his control.

Shetty reportedly created this platform, known as HighTower Treasury, in February 2022, just before he was informed of his impending departure as CFO due to performance concerns.

During the period between April 1 and April 12, 2022, Shetty allegedly transferred $35,000 from his employers to an account associated with HighTower without the knowledge of other company employees.

The ostensible intent of this transaction was for HighTower to invest the funds in the decentralized finance (DeFi) segment of the cryptocurrency market.

This arrangement provided Shetty’s company with a 6% interest rate, while Hightower would retain the remaining interest, which could result in substantial profits.

Prosecutors assert that the value of Shetty’s cryptocurrency investments began to rapidly decline, and by May 13, 2022, the $35 million investment had become virtually worthless.

The startup promptly notified the Federal Bureau of Investigation upon discovering the embezzlement, triggering an investigation into the matter.

If found guilty of wire fraud, Shetty could face up to twenty years in prison. He will likely be arraigned on May 25, 2023.

Cooper Morgenthau, the former chief financial officer of African Gold Acquisition Corporation, was sentenced to three years in prison for stealing more than $5 million from multiple special purpose acquisition companies (SPACs).

Between June 2021 and August 2022, Morgenthau transferred approximately $1.2 million to his accounts and used the funds to trade cryptocurrencies and “meme stocks,” resulting in substantial losses.