US charges ex-CEO of Crypto company Longfin $66 million in fraud

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US charges ex-CEO of Crypto company Longfin $66 million in fraud

On Wednesday, the 5th of June 2019, US prosecutors of a New Jersey district court had filed that the former CEO of now-defunct cryptocurrency company, Longfin Corp., Venkata Meenavalli, 49, had architected an accounting fraud to inflate the revenue of Longfin by more than $66 million.

The securities fraud case against Meenavalli was filed 18 months after the Longfin shares had gone for a roller-coaster ride just days after beginning trading and rising more that 13-folds of its initial offering, which briefly valued the company at $3 billion.

None the less, prosecutors of district judge of New Jersey had said in the court filing that Meenavalli had generate falsified documents such as millions of dollars of transactions, which were actually round-trip events between the companies the ex-Longfin CEO controlled, that made Longfin shares look more lucrative to the investors.

In point of fact, according to US attorney, Craig Carpanito in New Jersey, about $66 million of revenue found in the company documents was never generated and it should never have been recognized. New York-based Longfin, once a lucrative crypto company had turned out to be another fraud last year after US SEC had sued Meenavalli and three of his associates at a separate civil case, accusing the four individuals of wrongful gains.