By SDCN Staff
San Francisco, CA–A federal grand jury in the Northern District of California has indicted a Hawaii businessman on charges of wire fraud, securities fraud, and obstruction of justice in an alleged scheme to defraud investors of $170 million.
Abraham Shafi, 38, of Pepeekeo, Hawaii, is the CEO and founder of the social media startup Get Together, known publicly as “IRL.” Prosecutors say Shafi misled investors during the company’s 2021 Series C funding round, which raised $170 million at a valuation exceeding $1 billion.
According to court filings, Shafi assured investors that IRL relied on organic growth and spent only about $50,000 a month on paid advertising. In reality, prosecutors allege, the company spent millions on “incentive advertising,” a practice that rewards users through third-party apps for downloading IRL. Ahead of the Series C round, Shafi reportedly ordered a “big burst” of ads to boost app installs.
When investors questioned IRL’s advertising practices, Shafi allegedly concealed the true costs by routing invoices through a third-party vendor. Prosecutors say he later instructed an employee to falsify invoices by categorizing ad expenses as infrastructure costs and misled investors about how the funds were spent.
Authorities also allege that Shafi attempted to obstruct a federal investigation. When the Securities and Exchange Commission launched a probe, Shafi is accused of restoring his phone to a prior backup, erasing records, and urging employees to lie about his role.
If convicted, Shafi faces up to 20 years in prison on each count. Sentencing would be determined by a federal judge under U.S. Sentencing Guidelines.
The FBI is leading the investigation.
