Rishi Shah and Shradha Agarwal, two co-founders of Chicago-based health tech firm Outcome, have been convicted and sentenced for committing a $1 billion fraud scheme. Shah, a former billionaire and Outcome's former CEO, received a seven-and-a-half year prison sentence, while Agarwal, the former president, was sentenced to three years in a halfway house. The fraud, exposed by Wall Street Journal in 2017, involved selling advertising inventory that the company did not own and under-delivering on ad campaigns. Several high-profile investors, including Goldman Sachs and Google-parent Alphabet, were targeted in the scheme.
Rishi Shah and Shradha Agarwal: The Rise and Fall of Outcome Health
Background
Outcome Health, a Chicago-based health tech firm, was founded in 2010 by Rishi Shah and Shradha Agarwal. The company claimed to have a network of advertising displays in doctors' offices and other healthcare facilities, reaching millions of patients. Through its platform, Outcome sold advertising space to pharmaceutical companies and other health-related businesses.
The Fraud Scheme
In 2017, The Wall Street Journal exposed an elaborate fraud scheme perpetrated by Outcome Health. The investigation revealed that the company had been selling advertising inventory that it did not own and under-delivering on ad campaigns. Outcome had inflated its reach and audience numbers to attract high-profile investors.
Conviction and Sentencing
In October 2020, Shah and Agarwal were convicted on multiple counts of federal fraud charges. Shah was sentenced to seven-and-a-half years in prison, while Agarwal received a three-year sentence in a halfway house.
Fallout
The fraud scheme had far-reaching consequences. Several major investors, including Goldman Sachs and Alphabet Inc., lost millions of dollars. The scandal also raised concerns about the integrity of the digital advertising industry.
Top 5 FAQs
1. Who are Rishi Shah and Shradha Agarwal?
They are the co-founders of Outcome Health, a health tech firm that was convicted of a $1 billion fraud scheme.
2. What was the nature of the fraud scheme?
Outcome Health sold advertising inventory that it did not own and under-delivered on ad campaigns.
3. Who were the victims of the scheme?
High-profile investors, including Goldman Sachs and Alphabet Inc., were targeted.
4. What were the sentences for Shah and Agarwal?
Shah received a seven-and-a-half-year prison sentence, while Agarwal was sentenced to three years in a halfway house.
5. What is the current status of Outcome Health?
The company filed for bankruptcy in 2019 and has since dissolved.
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