Ex-CFO of Mercer Island convicted of wire fraud as $35 million crypto bet collapses to nothing

Mercer Island CFO Steals $35 Million in Company Funds

A man from Mercer Island was found guilty of four counts of wire fraud after he reportedly embezzled $35 million from his previous employer to finance a cryptocurrency venture, which he ultimately lost.

Nevin Shetty, 41, was convicted following a jury trial that lasted nine days, as stated by the Department of Justice. The jury took around 10 hours to reach their verdict.

“This defendant abused his position of power and trust to profit from his crime, and then lied to cover it up,” U.S. Attorney Neil Floyd remarked. “I am proud of our attorneys and support staff. They effectively helped the jury see through the misleading evidence presented by the defense to justify the theft.”

Shetty began his role as CFO in March 2021 at a private software firm that had secured funding through various rounds. As the company expanded, it established a policy aimed at safeguarding the raised funds.

The company instituted an investment policy restricting cash investments to money market accounts and other low-risk assets, with the goal of preserving the capital necessary for operations and growth. All assets were kept in FDIC-insured Treasury and operating bank accounts.

Details of the Theft

Interestingly, Shetty was involved in drafting that very policy, which he later shared with the board for approval. However, he discreetly funneled around $35 million from the company’s funds to a cryptocurrency platform he operated as a side project.

He set up a company named Hightower Treasury in February 2022, though it had no external clients at the time. Shortly afterward, in March 2022, Shetty was made aware that he would not continue as CFO due to performance issues, yet he lingered at the firm. Almost immediately after this news, he transferred money out of the company’s account.

Between April 1 and April 12, 2022, Shetty moved $35,000,100 to an account belonging to Hightower Treasury. None of the firm’s executives were aware of this transaction.

Afterward, he shifted the stolen funds into cryptocurrencies, opting for a decentralized finance (DeFi) lending platform claiming 20% returns on investments.

Shetty intended for Hightower to return 6% of the interest to his company, pocketing the remaining earnings since he owned Hightower. Initially, he and a business partner reportedly made around $133,000 in the first month. Yet, despite this early success, Shetty’s investment had plummeted in value to nearly $0 by May 13, 2022, merely a month after the funds were misappropriated.

Upon disclosing his actions to two colleagues, he was quickly terminated.

The company later alerted the Federal Bureau of Investigation, prompting an inquiry into Shetty’s actions.

“Why would he do this? Greed. It’s that simple, which explains his lies, secrets, and half-truths,” Assistant U.S. Attorney Philip Kopczynski argued during the closing statements.