Paul Roberts, former CEO of digital advertising technology firm Kubient, has been sentenced to one year and one day in prison for financial fraud.
Kubient and another unnamed company reportedly faked a $1.3m transaction, generating false revenue to boost financials. Roberts faked financial records and created a bogus test of Kubient’s Kubient Artificial Intelligence (KAI) software to make the company look more successful.
The company, founded in 2017, specialises in programmatic advertising and fraud detection, and developed real-time ad marketplace Audience Cloud and KAI, a tool it claimed could prevent ad fraud.
By the end of 2023, after the company went public in 2020 and raised over $32.5 m, it was delisted from the Nasdaq and filed for bankruptcy.
The company’s CFO and audit committee chair became aware of the fraud before the company’s secondary public offering, but failed to inform investors.
The decision was issued by the US District Judge Jennifer L Rochon in the Southern District of New York. The SEC charged Roberts, as well as Kubient’s CFO and Audit Committee Chair for failing to act on the fraud before the secondary public offering.
Acting US Attorney Matthew Podolsk said: “Paul Roberts cooked the books. He lied to investors and auditors about his company’s revenue and about his company’s premier product: an AI-powered tool that, ironically, was supposed to detect fraud in the digital advertising industry.”
This article was first published by Performance Marketing World.
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