A Seattle-based startup on Wednesday charged its former Chief Financial Officer (CFO) for investing $35 million of the firm’s money in cryptocurrencies. According to the filing announced by the US Attorney’s Office, Western District of Washington, the ex-boss took the money without permission and lost it all in his crypto venture.
The private company hired Nevin Shetty, 39, in March 2021 as its CFO, the filing stated. After the Seattle-based firm raised funds from multiple fundraiser programs, it, under the leadership of Shetty, sought ways to invest the money with minimal risks. After much consideration, the company decided to invest in fixed-income instruments payable in US dollars.
Shetty Secretly Moved Funds
The indictment stated that despite Shetty agreeing to the investment policy, he secretly moved $35 million to his side crypto business, HighTower Treasure, where he invested the money in decentralized finance (DeFi). Shetty then lost his job in March 2022 after the firm could no longer manage his underperformance.
According to the filing, Shetty intended to pay 6% to the company and keep the remaining profits from his crypto venture. However, the $35 million invested by HighTower Treasure in DeFi was almost worth nothing in May 2022, prompting the start-up firm to file the indictment.
Shetty’s Attorney Frowns at Indictment
In an emailed statement, the attorney representing Shetty, Cooper Offenbecher, noted that he and his client have been cooperating with prosecutors and frowned at the indictment filing.
“As the CFO of his former employer, tasked with making investment decisions for its 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. We look forward to responding to these allegations in court,” Offenbecher stated.
The court has scheduled the arraignment date for May 25, 2023. If found guilty, Shetty risks spending up to 20 years in prison.
