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- The SEC on Tuesday charged the former CEO of a tech company backed by Goldman Sachs with running a $67 million securities fraud.
- The agency alleged Christopher Kirchner, former head of Slync, "misappropriated" $28 million for its own benefit, including using the funds to buy a private jet.
- He also used investor proceeds to pay for his "lavish lifestyle" while Slync workers went unpaid, the SEC alleged.
The Securities and Exchange Commission on Tuesday charged the former CEO of a tech company backed by Goldman Sachs with fraudulently selling millions of dollars worth of securities to support his "lavish lifestyle."
The SEC said it charged Christopher S. Kirchner, the co-founder of Slync, a privately held logistics software company, with fraudulently offering and selling more than $67 million of securities to multiple investors.
Kirchner "misappropriated" more than $28 million for his personal benefit, the agency said in a statement.
"We allege that Kirchner lied about Slync's business to secure tens of millions of dollars from investors, a massive portion of which he then stole from the company to live extravagantly while not paying Slync's employees," Sheldon Pollock, associate director of the SEC's regional office in New York, said in the statement.
Kirchner's house was raided by FBI agents in Westlake, Texas, on Tuesday, Forbes reported, saying images and video footage it had obtained showed at least a dozen federal agents entering his "opulent" home.
Forbes said other images it had received showed a Mercedes G Class and a Rolls Royce Collinan SUV being towed from Kirchner's property. A spokesperson for the FBI's office in Dallas confirmed agents visited the property but wouldn't say whether Kirchner had been arrested or charged, the report said.
Kirchner could not be reached for comment by Forbes, and a family member did not respond to a request for comment. Slync did not respond to a Forbes request for comment.
Kirchner was fired as Slync's CEO in August 2022. Insider previously reported that Slync had failed to pay employees in full for nearly three months and later laid off some staff.
The SEC alleges Kirchner misrepresented Slync's financial condition to investors between January 2020 and January 2022, among other things. It claims Kirchner between March 2020 and his firing had transferred tens of millions of dollars from Slync's corporate bank accounts to his personal bank accounts and that he paid for his personal expenses directly out of one of Slync's bank accounts.
"As alleged in the complaint, Kirchner used the money to, among other things, fund his personal investment entity, KFIM LLC, pay entertainment expenses, and purchase a $16 million personal private jet, all while failing to make timely payroll distributions to Slync employees on several occasions," the SEC said, characterizing Kirchner's lifestyle as "lavish"
The SEC complaint was filed in the US District Court for the Northern District of Texas. The agency said it's seeking permanent injunctive relief, civil penalties, and a bar against Kirchner serving as an officer and director, among other actions.