In recent years, a fintech company focused on sustainability gained significant attention, attracting high-profile investors such as celebrities and environmental advocates. However, the company now faces a serious scandal as its co-founder prepares to admit guilt in a massive fraud scheme amounting to $248 million, as reported by federal prosecutors.
Joseph Sanberg, who was taken into custody earlier this year, has agreed to plead guilty to multiple counts of wire fraud. These serious charges could result in a lengthy prison sentence, with each count carrying a potential penalty of up to 20 years.
According to the Acting United States Attorney, this individual, who positioned himself as an advocate for anti-poverty initiatives, has been revealed as a self-serving fraudster. His actions allegedly involved deceiving both lenders and investors, leading to significant financial losses.
Sanberg is accused of manipulating the financial records of the company by concealing the true sources of payments that were used to artificially inflate revenue figures. He reportedly secured letters of intent from various companies that expressed interest in utilizing the startup’s tree planting services, which falsely committed them to substantial monthly revenues.
However, the funds that were reported as revenue actually originated from entities controlled by Sanberg himself, thereby misleading stakeholders about the company’s financial health.
Additionally, he is alleged to have forged a letter from the company’s audit committee, falsely claiming that the startup had $250 million in cash reserves. In reality, the company had less than $1 million available.
Using this fraudulent documentation and inflated revenue claims, Sanberg is said to have secured $145 million in loans by leveraging his shares in the company. He also allegedly collaborated with a board member to inflate asset values, further complicating the fraudulent scheme. The company ultimately defaulted on these loans on two separate occasions.
As a result of these deceptive practices, victims of the fraud incurred losses exceeding $248 million, according to the U.S. attorney’s office.
Despite the ongoing investigation, Sanberg reportedly continued to solicit investments in the company’s securities well into 2025. A formal plea is expected to be filed in the near future, marking a significant development in this high-profile case.