Fraud Rumored at $85 Million Startup

Canopy Financial the latest in private-equity fraud cases

By Jackson West
|  Tuesday, Nov 24, 2009  |  Updated 1:30 PM PDT
View Comments (
)
|
Email
|
Print
Fraud Rumored at $85 Million Startup

Getty Images

Some Silicon Valley entrepreneurs are reportedly taking shortcuts to the Benjamins.

advertisement

Canopy Financial announced a $62.5 million take in its latest round of venture capital investment just last October, having raised a total $85 million in equity and debt investment since last year.

But it sounds like the company might have cooked some books to woo investors.

Anonymous sources have told local tech blog TechCrunch that the company may have even forged audit reports in the name of accounting firm KPMG, and is being sued by a major investor in the latest funding round.

Canopy claimed to be tackling the healthcare cost crisis by introducing new healthcare banking products.

In moves that seem to confirm the allegations, major investors have removed the company from their portfolio listings, and the company has replaced its website with a simple information page.

If true, Canopy, which has an office in San Francisco, adds to a growing number of suspected and confirmed private equity fraud cases, from the Galleon Group's hedge fund's insider trading case to a suspected Ponzi scheme masquerading as a hedge fund in San Francisco's Financial District.

Jackson West has some spreadsheet projections that will blow your mind, unsuspecting venture capitalist, and he would be happy to take your calls.

Get the latest headlines sent to your inbox!
View Comments (
)
|
Email
|
Print
Leave Comments
Bay Area Proud
Bay Area Proud is NBC Bay... Read more
Follow Us
Sign up to receive news and updates that matter to you.
Send Us Your Story Tips
Check Out