Seattle CFO Nevin Shetty sentenced to 2 years for wire fraud; $35M transferred to cryptocurrency platform without approval.
Sentencing and Conviction Details
A Seattle judge has sentenced Nevin Shetty, the former chief financial officer (CFO) of a local startup, to two years in prison for wire fraud related to a cryptocurrency business. The conviction stems from a scheme that involved the secret transfer of approximately $35 million in company funds to a cryptocurrency platform Shetty controlled as a side business.
The Fraud Scheme
Shetty's actions were described by the US Justice Department (DOJ) as a significant breach of trust. He moved the funds to the HighTower Treasury platform in 2022, just before a downturn in the cryptocurrency market, which eventually led to the revelation of the transfer. The DOJ stated that Shetty managed to make the transfers without the knowledge of any executives or board members at the Seattle startup. He then invested the funds in high-yield decentralized finance (DeFi) lending protocols that promised returns of 20% or more. Within a month, he earned $133,000 from these investments.
Market Downturn and Consequences
However, the cryptocurrency investments Shetty made with the stolen funds began to decline. By May 13, 2022, the value of the investments was nearly zero. After the funds were essentially depleted, Shetty informed two of his fellow executives about his actions. He was immediately terminated from his position.
Legal Proceedings
Shetty was indicted on charges of wire fraud in May 2023. After a nine-day jury trial, he was found guilty on four counts in November 2025. As part of his punishment, he has been ordered to repay the stolen funds and undergo three years of supervised release following his two-year prison sentence.
Broader Context
Shetty's case occurred months before the collapse of the cryptocurrency exchange FTX, which led to the arrest and conviction of its former CEO, Sam “SBF” Bankman-Fried. SBF was sentenced to 25 years in prison in 2024 and has since filed an appeal. As of Friday, the US Court of Appeals for the Second Circuit had not yet announced any decision following arguments heard in November.
Conclusion
The case highlights the potential risks and consequences associated with insider trading and unauthorized use of company assets in the rapidly evolving world of cryptocurrency. Shetty's actions serve as a cautionary tale for financial professionals and businesses operating in the crypto space.
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