TLDR
- Former CFO Nevin Shetty covertly transferred $35 million in corporate assets into cryptocurrency without authorization from executives or the board
- Funds were invested in DeFi lending protocols offering yields exceeding 20%
- The Terra ecosystem crash in May 2022 decimated the investment, reducing it to virtually nothing
- Following a jury trial, Shetty was found guilty of four wire fraud counts and received a two-year prison sentence
- The unauthorized transactions resulted in approximately 60 layoffs and nearly bankrupted the organization
A former chief financial officer from Seattle has received a two-year federal prison sentence after being convicted of secretly channeling $35 million in corporate funds into cryptocurrency investments under his personal control.
U.S. District Judge Tana Lin issued the sentence in a Seattle federal court after a nine-day jury trial that reached its conclusion on November 7, 2025. The verdict found Nevin Shetty guilty on four wire fraud charges.
Shetty assumed the CFO position at the Seattle-based software startup in March 2021. Company policy explicitly required that all corporate funds remain in conservative, low-risk financial instruments such as money market accounts.
Ironically, Shetty participated in drafting these very policies. Yet in early 2022, he established HighTower Treasury, a crypto-focused venture that operated without any additional clients beyond his own purposes.
When company leadership informed Shetty in April 2022 that he would be dismissed from his CFO position due to performance issues, he took decisive action. Over a twelve-day period from April 1 through April 12, 2022, Shetty executed wire transfers totaling $35,000,100 from a Chase bank location near his residence, directing the funds into HighTower Treasury.
The board of directors and other senior executives remained completely unaware of these transactions.
Shetty proceeded to allocate the transferred capital into decentralized finance lending protocols. These DeFi platforms advertised annual yields of 20% or higher.
During the initial month, the strategy generated approximately $133,000 in returns.
When the Crypto Market Collapsed
The initial profitability proved short-lived. When the Terra ecosystem imploded in May 2022, it sparked a broader cryptocurrency market selloff. By May 13, 2022, Shetty’s DeFi positions had plummeted to essentially worthless levels.
Facing the reality that $35 million had evaporated, Shetty disclosed his actions to two executive colleagues. His employment was terminated immediately.
Judge Lin noted that the fraudulent scheme had devastating ramifications. The disappearance of these funds compelled the company to terminate roughly 60 employees and brought the business to the brink of complete failure.
Federal prosecutors indicted Shetty on wire fraud charges in May 2023. Following the November 2025 conviction after the jury trial, sentencing took place in March 2026.
Crypto Fraud Cases Continue in U.S. Courts
This prosecution represents one among numerous prominent cryptocurrency fraud cases that have proceeded through the American judicial system in recent years.
FTX CEO Sam Bankman-Fried, for example, received a 25-year prison sentence in 2024. His attorneys have filed an appeal, and as of Friday, the U.S. Court of Appeals for the Second Circuit has yet to deliver its decision following oral arguments heard in November.
Beyond the two-year incarceration period, Shetty faces a restitution order requiring repayment of the complete $35 million. Upon release, he must also complete three years of supervised release.
