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American embezzles $35 million and loses it in the collapse of Terra token., 2026/03/07 10:41:14
Nevin Shetty, a 42-year-old resident of Washington, has been sentenced to two years in prison for embezzling funds from his former employer. The majority of the stolen money was lost following investments in DeFi protocols and the subsequent collapse of the Terra ecosystem.
In addition to his prison sentence, the court ordered Shetty to pay $35,100,000 in restitution. Upon his release, he will be under probation supervision for three years. He is also prohibited from holding executive or director positions in any companies without special permission.
According to case documents, Shetty served as the chief financial officer at a private IT firm. In April 2022, management informed him of the termination of his duties due to unsatisfactory performance.
Following this, Shetty secretly transferred approximately $35 million of corporate funds to his own side business—HighTower Treasury. He directed the stolen funds towards investments in decentralized lending crypto protocols that promised returns of 20% per annum or more.
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Court records indicate that the defendant intended to pay his former employer a “relatively small fixed amount,” while keeping the remaining profits for himself and his partner at HighTower.
Initially, the scheme did yield profits. In the first month, Shetty and his partner earned around $133,000. However, the situation drastically changed in May 2022, when the Terra ecosystem collapsed, leading to a significant crypto winter. The value of HighTower’s crypto investments plummeted from $35 million to nearly zero.
The court noted that Shetty’s actions as CFO caused “substantial and serious harm” to the company and nearly drove it to bankruptcy. As a result of the financial losses, the company was forced to lay off about 60 employees.
The prosecution argued for a harsher sentence, seeking ten years of imprisonment, citing the extent of the losses and the “web of lies” created by the fraudster.
Previously, South Korean authorities apprehended a crypto scammer who, in 2019, stole crypto assets worth 120 million won (approximately $81,000) and had long been officially declared deceased. He was found abroad, deported back to his home country, and all his cryptocurrency assets were confiscated.
