What happened in the Nevin Shetty crypto fraud case?

Nevin Shetty, a former chief financial officer in Washington, was sentenced to two years in prison after secretly diverting $35 million from his employer into cryptocurrency investments. He transferred company funds into his own decentralised finance platform called HighTower Treasury. Most of the money was lost after the Terra crypto ecosystem collapsed in May 2022.

Who is Nevin Shetty and what role did he have at the company?

Nevin Shetty, age 42, served as chief financial officer at a private software company in the United States. As CFO, he controlled company finances and even drafted the firm’s internal investment policy. Prosecutors said he abused that position by secretly moving company funds into his personal crypto venture.

How much money was lost in the crypto investments?

Roughly $35 million in company funds was moved into crypto investments through HighTower Treasury. After the Terra ecosystem collapsed and the broader crypto market entered a downturn, the value of those investments dropped to almost zero. The collapse wiped out nearly all of the diverted funds.

What financial penalties did the court impose on Shetty?

The court ordered Shetty to repay $35,000,100 in restitution to compensate for the stolen funds. After serving his prison sentence, he will also spend three years under supervised release. These conditions are meant to ensure financial accountability and monitoring after his release.

What does this case highlight about the risks of DeFi investing?

The case shows how high-yield DeFi platforms can carry significant risk, especially during market downturns. Protocols promising returns of 20 percent or more often depend on volatile crypto markets and complex lending structures. For investors, the Terra collapse demonstrated how quickly these ecosystems can fail and erase large amounts of capital.

Cryptocurrency

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CFO jailed after $35 million company funds lost in crypto scheme

Written by Liezl GambePublished Mar 7, 2026, 12:00 AMLast Updated Mar 6, 2026, 8:09 PM

A former chief financial officer in Washington has been sentenced to two years in prison after secretly diverting $35 million from his employer into risky cryptocurrency investments.

The case centres on 42-year-old Nevin Shetty, who previously worked for a private software company where he held responsibility for overseeing financial operations.

Prosecutors confirmed that Shetty was convicted of wire fraud in November after investigators uncovered that company funds had been moved without authorisation.

Authorities said Shetty secretly transferred approximately $35 million from the firm into his own decentralised finance project called HighTower Treasury.

The transfers reportedly took place shortly after he was informed in April 2022 that his position as chief financial officer would be terminated due to performance concerns.

Despite drafting what was described internally as a conservative investment policy for the company, Shetty moved the funds into high-yield DeFi lending protocols offering returns of 20 percent or more.

According to the United States Department of Justice, Shetty planned to repay the company a small fixed return while keeping the majority of profits generated through the HighTower platform.

The strategy initially generated gains, with court documents showing the operation produced around $133,000 in profits during its first month.

However, the situation deteriorated rapidly in May 2022 when the collapse of the Terra ecosystem triggered widespread losses across cryptocurrency markets.

The value of Shetty’s investments reportedly plunged from roughly $35 million to almost nothing as the broader crypto market entered a severe downturn.

After the losses became apparent, Shetty admitted the scheme to colleagues at the company where he worked.

Following the admission, he was immediately dismissed from his position.

Judge Tana Lin stated during sentencing that the company experienced serious financial harm as a result of the incident.

"His actions had significant and severe effects and almost put the company out of business,"

Judge Tana Lin said.

The company was later forced to lay off about 60 employees while attempting to recover from the major financial losses linked to the scheme.

Prosecutors had requested a prison sentence of nine years, arguing that a harsher penalty was necessary due to the scale of the fraud and the deception involved.

Despite that request, the court ultimately imposed a shorter sentence of two years in federal prison.

In addition to the prison term, Shetty has been ordered to repay $35,000,100 in restitution.

The court also ruled that he will remain under supervised release for three years once his prison sentence is completed.

Judge Lin imposed further restrictions preventing Shetty from serving as a company officer or director without prior approval from probation authorities.