The former CEO of a tech startup named SKAEL Inc, (SKAEL) faced charges as a result of a Securities and Exchange Commission (SEC) investigation.
The SEC alleges that Baba Nadimpalli, the former founder of this company, who is based in San Francisco, is culpable of $30 million in fraud and financial damages.
Former CEO faces $30m fraud charges
According to the SEC report, SKAEL started as a private technology company that developed business automation software.
The SEC filed an action alleging that from January 2021 through February 2022, Nadimpalli “raised more than $30 million from investors by falsely claiming that SKAEL had millions of dollars in annual recurring revenue, more than 10 times the true amount.”
The filing also stated that Nadimpalli forged bank statements and business documents, and he boasted about false ties to industry heavyweights to entice investors. These links to established and well-known companies were allegedly false.
According to the SEC the former CEO also spent a large amount of SKAEL funds to fund his personal life and a raft of payments on property and vehicles.
The businessman’s alleged fraud was filed in the U.S. District Court for the Northern District of California, which charged Nadimpalli with violating the antifraud provisions of the federal securities laws.
The U.S. Attorney’s Office for the Northern District of California (USAO) has also announced that criminal charges have been filed against Nadimpalli.
“Startup founders cannot fake it until they make it by falsifying revenue metrics shared with investors,” said Monique C. Winkler, Director of the SEC’s San Francisco Regional Office. “While the SEC will continue to aggressively pursue private company executives who use falsehoods to raise money from investors, we also urge those who invest in private companies to remain vigilant.”
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