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A former chief financial officer in Washington received a two-year federal prison sentence after diverting $35 million from his employer to fund a personal cryptocurrency venture. The US Department of Justice said Nevin Shetty, 42, secretly moved company funds into his HighTower Treasury platform and directed them into high-yield decentralized finance lending operations.
Prosecutors said the transfers occurred in April 2022 without approval from executives or the company’s board.
Authorities charged that Shetty aimed to generate large crypto returns while promising his employer only a limited fixed payout. The scheme initially produced modest profits but collapsed after the broader crypto market fell during the Terra ecosystem crisis.
Prosecutors said Shetty diverted the funds shortly after learning that performance issues would end his role as chief financial officer. He transferred the money into HighTower Treasury, a crypto platform he controlled.
Company executives and board members did not know about the transfers at the time. Shetty directed the funds into decentralized finance lending protocols that promoted returns of 20 percent or more. According to the Justice Department, he planned to send his employer a fixed return while keeping the remaining profits through his platform.
For a short period, the strategy appeared profitable. Court filings show the investments generated roughly $133,000 during the first month of activity. Soon after, conditions in the cryptocurrency market shifted. The collapse of the Terra ecosystem triggered a wider downturn across digital assets and DeFi lending markets.
Prices dropped quickly while liquidity dried up across several platforms. As a result, the value of the investments fell sharply.
Prosecutors said the decline accelerated within weeks of the transfers. The Justice Department reported that the value of the investments dropped rapidly during the market turmoil. Officials said that by May 13, 2022, the value of the funds had almost completely vanished.
“The cryptocurrency investments that Shetty made with the stolen funds soon began declining, and by May 13, 2022, the value of the investments was nearly zero,” prosecutors stated. Once the losses became unavoidable, Shetty disclosed the transfers internally.
He informed two executives at the company after the funds had effectively disappeared. The company then terminated his employment. What happens when corporate trust meets high-risk crypto speculation? Authorities later opened a criminal investigation into the transfers.
Federal prosecutors charged Shetty with wire fraud in May 2023. The case moved through the federal court system over the next two years.
Judge Tana Lin found Shetty guilty on four counts of wire fraud in November 2025. The court reviewed evidence showing how the scheme drained $35 million from the company. Judge Lin said the actions deeply affected the business and disrupted the lives of employees. The company later carried out layoffs that affected 60 workers.
During sentencing, the judge told Shetty that his actions nearly pushed the company toward collapse. “You almost put the company out of business… You were playing with money that wasn’t yours,” Lin said in court. Prosecutors asked the court to impose a nine-year sentence.
They argued that the fraud caused massive losses and triggered layoffs across the company. The court instead ordered a two-year prison term. Shetty must also pay $35,000,100 in fines and restitution.
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After prison, he will serve three years under supervised release. Judge Lin also barred him from serving as a corporate officer or director unless a probation officer grants approval.
The Justice Department drew parallels with other crypto fraud prosecutions. Crypto entrepreneur Do Kwon received a 15-year prison sentence for fraud after authorities extradited him on December 31, 2024.
He later entered a guilty plea in August 2025. US District Judge Paul A. Engelmayer delivered the sentence. According to US Attorney Jay Clayton, Kwon deceived investors while inflating the value of Terraform digital assets.
Prosecutors said Terraform claimed to operate a decentralized financial ecosystem with a currency, payment system, exchange, and savings bank. Authorities said that these products did not function as promised and were manipulated to create the appearance of a working financial system.
Nevin Shetty received a two-year prison sentence after diverting $35 million into HighTower Treasury for risky DeFi lending. Early gains vanished after the Terra collapse. The case shows how wire fraud and unchecked crypto bets can severely damage companies and cost jobs.
