Former CEO of virtual reality company pleads guilty to securities fraud.
The former head of a virtual reality company pleaded guilty to securities fraud in June 2018. Neil Chandran was a past CEO of the Sungame company. Through this company, Chandran conducted a scheme to steal millions from investors. He did this through the sale of computer tablets valued at $1,000.
The perpetraitor told victims that the computer tablets showed 3D content. The content could then be seen in a virtual reality setting on the tablets. After paying $1,000, investors would supposedly receive their money back. Chandran kept his promise to a certain extent. He paid back some investors, but according to officials, an “overwhelming majority” did not receive anything back. Officials also said that a lot of the money went to earlier investors.
Upon investigation, it was clear that paying customers back as promised was never a viable option. This was because in order to keep the scheme up, Chandran had to use investors’ money to buy the computer tablets. He was also using the funds to secretly pay his own personal and corporate expenses. For these reasons there was never enough to repay investors.
Before pleading guilty, Chandran had been dealing with securities fraud allegations for a while. In 2015, these allegations caused him to step down as CEO from Sungame. But he claimed it was so that he could have a more “hands-on” role in the company. On Thursday June 28, 2018 the former CEO of Sungame got a not so sunny sentence to pay back $768,000 in restitution. He also received orders to pay back over $2.1 million to victims. If these orders are not met, a sentence of up to 4 years in prison could be given.