SEATTLE (AP) — The former CFO of a Seattle-based startup took $35 million of his employer's money without permission and lost it investing in cryptocurrencies before the crypto market crashed last year, according to a federal indictment filed by a major jury. Wednesday.
Nevin Shetty, 39, was hired in March 2021 as the CFO of a company called fabric, which makes software platforms for retail.
About a year later, after the company informed him it would let him talk about his job performance issues, he secretly took the money and transferred it to HighTower Treasury, a cryptocurrency platform he controlled as a side business, according to the indictment.
His idea was to pay the company 6% interest and retain earnings on top of that, but soon the $35 million investment was virtually worthless, the US Attorney's Office in Seattle said in a news release.
The indictment in the US District Court charged Shetty with four counts of wire fraud. He is scheduled to be arraigned on May 25.
Shetty's attorney, Cooper Offenbecher, said in an emailed statement that he and his client had been in regular contact with prosecutors and disagreed with the decision to file an indictment.
“As the CFO of his former employer, charged with making investment decisions for his benefit, Mr. Shetty was personally devastated by these losses, which occurred as a result of a catastrophic crash in the cryptocurrency market in May 2022,” he wrote. Offenbecher. "We look forward to responding to these allegations in court."
However, prosecutors said that as the company raised hundreds of millions of dollars in seed funding, it took a conservative approach to managing that money, a policy Shetty had helped draft.
According to Seattle tech news website GeekWire, the fabric had raised more than $293 million as of February 2022 and was valued at $1.5 billion.
In an emailed statement, the company said it had been cooperating with law enforcement and appreciated the work of the FBI and federal prosecutors.
“While the amount taken is substantial, the fabric remains very well funded with years of runway,” the statement said.
