2 Indian-Americans sentenced for $1 billion fraud

Two Indian-origin people, the former executives of a Chicago-based health technology start-up company, were sentenced on charges of being involved in a fraud scheme allegedly targetting the company's clients, lenders, and investors.

Jul 2, 2024 - 14:54
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2 Indian-Americans sentenced for $1 billion fraud

Two Indian-origin people, the former executives of a Chicago-based health technology start-up company, were sentenced on charges of being involved in a fraud scheme allegedly targetting the company's clients, lenders, and investors.

According to the US Department of Justice, the charges involved approximately $1 billion (Rs 7500 crore in Indian currency) in fraudulently obtained funds. The accused were identified as 38-year-old Rishi Shah - the co-founder and former CEO of Outcome, and 38-year-old Shradha Agarwal, a co-founder and former president of Outcome. Another person, 35-year-old Brad Purdy - the former chief operating officer and chief financial officer of Outcome, was also among the accused.

While Rishi was sentenced on June 26 to seven years and six months in prison, Shradha was sentenced on June 30 to three years in a halfway house. Brad was also sentenced on June 30 to two years and three months in prison.

An official release in the case suggested Shah, Agarwal, and Purdy lied or caused others to lie to conceal the under-deliveries from clients and make it appear as if the company was delivering advertising content to the number of screens in the clients' contracts. Purdy and others at Outcome also inflated metrics that purported to show how frequently patients engaged with Outcome's tablets installed at doctors' offices.

According to the trial evidence, the scheme targeting Outcome's clients began in 2011 and lasted until 2017, and resulted in at least $45 million of overbilled advertising services.

Shah, Agarwal, and Purdy also defrauded Outcome's lenders and investors, the release stated. The under-delivery to Outcome's advertising clients resulted in a material overstatement of Outcome's revenue for the years 2015 and 2016. In April 2023, a federal jury convicted Shah, Agarwal, and Purdy.

 

 

 

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