Chicago, July 2: Rishi Shah and Shradha Agarwal, two former executives of Chicago-based healthcare technology startup Outcome, have been sentenced for orchestrating a massive fraud totaling USD 1 billion. The sentencing comes after they were found guilty of deceiving clients, lenders, and investors through a complex scheme.
Rishi Shah, co-founder and former CEO of Outcome, received a 7.5-year prison term, while Shradha Agarwal, the startup's former president, was sentenced to 3 years in a halfway house. Both were integral figures at Outcome, which initially operated under the name Context Media, known for placing screens and tablets in doctors' offices and selling advertising space to pharmaceutical companies.
The fraud involved overbilling clients and inflating advertising metrics to mislead lenders and investors. Brad Purdy, another key figure at Outcome, received a 2.25-year prison sentence for his role in the scheme. The trio manipulated advertising metrics to falsely portray engagement levels on the company's devices, deceiving clients about the effectiveness of their campaigns.
In April 2023, a federal jury convicted Shah and Agarwal on multiple counts of mail fraud, wire fraud, bank fraud, and money laundering, citing significant discrepancies in Outcome's revenue reporting from 2015 to 2016. The case highlighted the extent of financial misconduct in the healthcare tech sector.
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