From ’30 Under 30′ to Fraud: The Dark Side of Early Success

In June, Nate Paul, an investor once considered a “real estate genius,” was sued on eight counts of allegedly making false statements on loan applications, which eventually led to banks lending the investor more than $170 million. According to the charge, in one filing, Paul claimed to have an account with $31.6 million in cash, when the account in question actually had less than $500,000. Paul’s alleged violations took place between March 2017 and April 2018.

In 2017, Paul was named to Forbes Magazine’s much-wanted list of “30 Under 30,” a compilation that pays tribute to those who have made remarkable strides in the business world before the age of 31. However, his recent charge is, “It wasn’t just a one-time situation where a businessman turned out to be a possible con artist.”

Paul, who has pleaded not guilty to the charges and is awaiting trial, has joined the notorious group of “30 Under 30” honorees who have been lauded by the public for their early success – before authorities discovered the illicit shortcuts that brought them there.

Since 2011, the magazine has used the annual list to celebrate and honor entrepreneurs who excelled in their field early in their careers. Each year, the company thoroughly vets each of the nearly 100,000 nominees. As Betsy Reed from the Guardian notes“The problem here is not Forbes, the problem is the vision of success that has been sold to us and the fetishism of youth. 30 Under 30 is not just a list, it’s a mindset: a push to achieve great things before the youth you slip.”

So, the next time you feel discouraged because you haven’t reached your goals by a certain age, think about these entrepreneurs turned felons who were once honored for their achievements in their youth. And those achievements? They would not have been possible without taking turns and crossing legal boundaries.

Sam Bankman Fried

Sam Bankman-Fried, the founder of cryptocurrency exchange FTX, was named to the list in 2021 for Finance.

Bankman-Fried started Alameda Research in 2017 and later founded FTX in 2019, which is valued at $32 billion in 2022. But in November of that year, FTX filed for bankruptcy after struggling to raise money and facing a liquidity crisis, and US prosecutors charged him with fraud. He was arrested in the Bahamas in December 2022 and charged with defrauding investors in a scheme that led to the bankruptcy of his company.

In February, four additional charges were brought to his docket for conspiracy to make more than 300 illegal political donations. Currently, Bankman-Fried is out on bail, living in his parents’ house and awaiting trial (which is scheduled for October).

Related: Who Is FTX Founder Sam Bankman-Fried And What Did He Do? Everything you need to know about the nefarious crypto king

Elizabeth Holmes

Elizabeth Holmes founded Theranos in 2003, a company that promised revolutionary blood testing technology, and was once hailed as the world’s “youngest self-made female billionaire.” The company caught the attention of high-profile investors and companies (many of whom had never even seen the technology before investing) and formed partnerships with major brands such as Safeway and Walgreens.

Holmes was never officially on the “30 Under 30” list, but she did headline the “Under 30 Summit” in 2015, where she also accepted the “Under 30 Doers Award” for her work in healthcare and the potential impact of her company’s technology.

However, just weeks after accepting her Doers Award, Holmes became the subject of an investigation by The Wall Street Journal, which raises questions about the legitimacy of its technology. What followed was nothing less than one accident after another: failed lab inspections, a slew of lawsuits, and the not-to-be-forgotten drop in wealth from $4.5 billion to $0 in 2016.

Finally, in 2018, it was revealed that the technology just wasn’t working, the company collapsed, and Holmes was charged with “massive fraud” by the SEC, alleging that Holmes had knowingly misled investors and the public.

Elizabeth Holmes speaking at the 2015 Fortune Global Forum in San Francisco, California, in 2015. David Paul Morris | Getty Images.

After nearly a year of delays due to the pandemic, Holmes’ trial began in 2021, and she was ultimately convicted of four counts of fraud in 2022 and sentenced to 11 years in prison. After a request for a new trial was denied in November 2022, Holmes began her sentence in May 2023. Through it all, Holmes has maintained her innocence. She is currently in jail in Bryan, Texas.

Holmes’ cheating story has been the subject of widespread media attention, including a 2019 HBO documentary, The inventor, and 2022 Hulu Miniseries, the dropout (for which Amanda Seyfried won an Emmy for her portrayal of the disgraced founder).

Related: I worked side-by-side with Elizabeth Holmes. She seemed like a visionary, but we were all cheated – and it’s comforting to see justice served.

Charlie Javice

Charlie Javice, of Frank, the college financial planning startup, was indicted in May 2023 on bank fraud, bank fraud and conspiracy charges. javices alleged crimes exaggerating the value of her startup during its acquisition by JPMorgan Chase in 2021.

Javice was named to the list in the Finance category in 2019 after she founded her company Frank, which aimed to help students apply for loans more efficiently.

Prosecutors allege she misled the bank by fabricating data and inflating the number of Frank customers. Javice allegedly asked her technical director to create fake data, but when he refused, she hired a data scientist to generate a spreadsheet listing millions of fake user accounts for the $175 million acquisition, and eventually JPMorgan acquired the app.

However, in November 2022, an internal investigation led to her dismissal, followed by her arrest in April. In January 2023, JP Morgan sued Javice for defrauding the company. Javice is now charged with securities fraud, bank fraud, bank fraud and conspiracy. She is currently out on bail and maintains her plea of ​​not guilty.

Martin Skrekli

Martin Shkreli was named to the list in 2012 for Finance. At the time, he was recognized for his work as a hedge fund manager and businessroundups.org. Shkreli had gained attention for his success in the biotech industry, particularly his involvement in Retrophin, a pharmaceutical company he founded.

Shkreli co-founded several hedge funds and pharmaceutical companies, including Turing Pharmaceuticals, which notoriously acquired the life-saving anti-parasitic and anti-malarial drug Daraprim, then increased its price by 5.455% in 2015. The move earned Shkreli, then dubbed “Pharma Bro,” another title: “The Most Hated Man in America.”

In December 2015, he was arrested on charges of securities fraud and conspiracy. The allegations stemmed from his involvement with two hedge funds, MSMB Capital Management and MSMB Healthcare, as well as Retrophin.

Shkreli was accused of mismanaging funds, using assets from one of his companies to pay off debts owed by another, and defrauding investors. The allegations included a scheme in which he illegally used Retrofin’s assets to repay investors who had lost money in his hedge funds.

Peter Foley | Getty Images

In 2017, he was convicted of securities fraud and conspiracy, resulting in a seven-year prison sentence and hefty fines.

In 2022, Shkreli was released from prison (about four months early) and now advises for a law firm and lives with his sister in Queens, New York, according to the U.S. Parole Board.

Related: ‘The Most Hated Man In America’ Where Is Pharma Bro Martin Shkreli Now?

Shkreli also rose to prominence in 2015 when he bought the only copy of the Wu-Tang Clan album, “Once Upon a Time in Shaolin”, for $2 million at auction. Fans and music industry vets criticized the lack of accessibility of such a culturally significant work, exacerbated by Shkreli’s decision to keep it as a rare collector’s item with no plans for a public release.

After his conviction, the album was confiscated by the government (along with his other assets) and eventually sold in 2021 as part of the forfeiture process. With the sale of the album, Shkreli’s payment of the forfeiture is complete, and the purchaser and price remain confidential.

Obinwan Okay

Obinwanne Okeke, a Nigerian-born businessroundups.org, was revered for his achievements in construction, agriculture and real estate. But in 2021, he was sentenced to 10 years in prison for his role in a computer-based fraud scheme that caused about $11 million in losses for his victims.

Okeke operated a group of companies — including the Invictus Group, which was the center of Okeke’s “30 Under 30” title in 2016 — but ultimately ran several computer-based frauds from 2015 to 2019.

Okeke’s plan involved obtaining credentials from hundreds of victims and committing “email compromise.” Through fraudulent wire transfer requests and false invoices, Okeke and his conspirators transferred nearly $11 million abroad. Okeke also carried out other forms of cyber fraud, including phishing emails and creating fraudulent web pages. Okeke is serving his sentence and will be released in 2028.