A California man has been sentenced to seven years in prison for defrauding investors of $23.1 million. The victims believed they were investing in high-profile tech startups, but the funds were used to make personal purchases. Sean Grusud used that money to buy luxury cars, condos, and extravagant spending.
CHICAGO – A California man was sentenced to seven years in prison for orchestrating a scheme to defraud investors of $23.1 million to fund a lavish lifestyle.
Prosecutors said Sean Grusde, 32, of Los Angeles, ran three investment funds that he said focused on private financial technology companies. He convinced more than a dozen victims to invest by providing misleading information about his fund’s past successes.
Starting in 2021, Grusud sold his funds using false claims, including that one of the funds was an early investor in well-known startups such as Instacart, Coinbase, and Shippo. Prosecutors said he was a Harvard Law School graduate who falsely claimed to be managing the portfolio of the CEO of a major investment firm.
Through his careful planning, his victims were persuaded to trust him with their money, some investing a significant portion of their life savings.
But instead of investing the money as promised, Grusud funneled it into personal accounts and spent it on luxury goods such as Porsche and Tesla cars, luxury apartments in Chicago and Montreal, and lavish travel and entertainment.
Assistant U.S. Attorney Corey Rubenstein said Grusud’s actions were a “terrifying series of deliberate choices” that caused untold financial harm to his victims.
Grusud pleaded guilty last year to wire fraud in federal court in Chicago. In addition to the prison term, he was ordered to pay more than $21 million in restitution to his victims.
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Information in this article was provided by the U.S. Attorney’s Office for the Northern District of Illinois.
