Someone Didn’t Read His HBS Case Study In Successful Venture Capital Frauds

Iftikar Ahmed knows what we're talking about.
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Because if Iftikar Ahmed had read all the way to the end of it, he would have learned: If you’re already running an incredibly successful, decade-long con against your completely unsuspecting partners, don’t go and jeopardize the whole enterprise by doing something stupid. And moonlighting as an insider-trader when you’ve already stolen $65 million is as stupid as it gets, unless you count airport staffers who apparently don’t bother to look carefully at a passport’s expiration date.

Mr. Ahmed’s former colleagues at Norwalk, Conn.-based Oak found that he used doctored deal documents, phony exchange rates and fake invoices to siphon off millions of dollars into secret bank accounts, according to prosecutors and regulators. Oak made the discoveries only after Mr. Ahmed was arrested on insider-trading charges unrelated to his work at the firm….

After Mr. Ahmed was arrested in May on federal insider-trading charges, he surrendered U.S. and Indian passports, according to court records. In May, he fled the country using an expired passport, according to court documents. He is now a fugitive.

Now, in fairness, there is something to be said for the “basis of trust that’s required” among partners at a VC firm, as Oak COO Grace Ames put it. And it’s not like there was any way Oak could have caught Ahmed anyway, right?

In December, Mr. Ahmed persuaded fellow Oak partners they should pay $20 million for a $2 million stake in a Hong Kong-based online retailer, pocketing the $18 million difference, the government alleged.

Oak executives later testified that they didn’t learn of the actual $2 million sale price until after Mr. Ahmed’s arrest, even though the seller disclosed it in a news release, according to court filings and people familiar with the matter.

Harvard, Goldman Sachs, Venture Capital…Fugitive [WSJ]

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