Manish Lachwani, a tech entrepreneur of Indian Origin, was sentenced to 18 months in prison and fined $1 million for lying to investors about his company, HeadSpin Inc.’s finances, Californa.
He admitted to giving false financial information to raise over $100 million. Lachwani also altered invoices and deceived the company’s accountant to inflate revenue figures.
HeadSpin, founded in 2015, initially thrived, reaching a valuation of $1.1 billion by 2020.
However, discrepancies in financial reporting surfaced in 2020 when an employee raised concerns.
An audit revealed Lachwani’s fraud, prompting his resignation as CEO.
Despite Lachwani’s tearful apologies during sentencing, the judge imposed the 18-month prison term, rejecting arguments that investors didn’t lose money.
The judge stressed the seriousness of the offense, emphasizing the need for consequences.
Though prosecutors sought a five-year prison term, Lachwani’s sentence was lighter. He must surrender to prison by September 2.
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