- Chief Compliance Officer and VP of Legal Affairs, Arrow Electronics
By 
Adrianne Appel2024-06-12T22:14:00
The former chief executive officer of an artificial intelligence (AI) recruitment startup that is now closed faces up to 40 years in prison and the potential of penalties levied by the Securities and Exchange Commission (SEC) for allegedly defrauding investors of more than $27 million.
Ilit Raz, an Israeli citizen, was indicted by a grand jury in New York for misleading investors about the success of Joonko, which she founded. Joonko told investors it used AI to recruit job candidates to fulfill diversity, equity, and inclusion hiring goals for its Fortune 500 clients.
Between 2021 and 2022, Raz falsely claimed the company’s customers included one of the world’s largest credit card companies, a sports apparel company, an online travel business, and a major fashion brand. But none of them were customers, the Southern District of New York (SDNY) alleged in a press release Tuesday.
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Three former executives of Chicago-based Outcome Health, a healthcare technology company, were sentenced for misleading an auditor, clients, lenders, and investors about a scheme to sell $45 million in overbilled advertisements.
A Nevada energy and manufacturing company headquartered in Nova Scotia agreed to pay $1 million to settle charges levied by the Securities and Exchange Commission for alleged market manipulation and fraud, while the agency further investigates its former chief executives.
Prudent chief compliance officers should ensure artificial intelligence-related risks are being properly addressed at their businesses considering growing scrutiny being paid to the technology by the Department of Justice.
USAA Federal Savings Bank has been hit with its third cease and desist order from the Treasury Department’s Office of the Comptroller of the Currency in the past five years for failing to correct unsafe and unsound banking practices.
Becton Dickinson medical device company will pay $175 million for “repeatedly” misleading investors about its Alaris infusion pump, a product the company knew was flawed and was sold without the required patient-safety approvals, the Securities and Exchange Commission said.
The Securities and Exchange Commission charged bankrupt fashion retailer Express with failing to disclose nearly $1 million in perks to a former chief executive, but did not levy a financial penalty thanks to its cooperation, the SEC said.
