SEC Charges Founder of Payment Fintech Jumio with Fraud. Former CEO, Daniel Mattes Pays $17 Million Settlement

The Securities and Exchange Commission (SEC) has charged the founder and former chief executive mobile payment Fintech Jumio with defrauding investors. The former CEO of Jumio, Daniel Mattes, has agreed to pay more than $17 million to settle the charges. Mattes is also a “business angel” on the Austrian version of Shark Tank (2 Minuten 2 Millonen). Currently, he operates a different company in Austria –, an artificial intelligence startup.

According to the SEC, Mattes “grossly overstated Jumio’s 2013 and 2014 revenues and then sold shares he held personally to investors in the private, secondary market.” Mattes apparently gained $14 million by selling shares – a sale he hid from investors and the board.

The SEC complaint states that Mattes falsely told an investor that he didn’t want to sell any of his shares because there was “lots of great stuff coming up,” and that “he’d be stupid to sell at this point.”

Jumio then went on to restate its financial results in 2015, wiping out most of its revenue, and the shares became worthless after it filed for bankruptcy in 2016.

Mattes apparently claimed that Jumio’s gross revenue was $101 million in 2013. In fact, it was just $9.5 million. He also claimed the company was generating a $1.3 profit. In reality, Jumio had a net loss of $10 million.

“Mattes enriched himself at investors’ expense by making false claims about Jumio’s financial results,”commented Erin Schneider, Associate Regional Director for the SEC’s San Francisco office.  “Company executives must provide investors with accurate information irrespective of whether their companies are publicly or privately traded.”

The SEC settled a separate proceeding against Jumio’s former CFO Chad Starkey. The SEC called Starkey negligent in his management and stated he should have been aware of Mattes’ misstatements. Starkey is a licensed attorney in California and currently works as a solo practitioner representing early-stage Silicon Valley startups.

Starkey entered into a cooperation agreement to assist the SEC.  Starkey, who sold some of his own shares in 2014, will pay approximately $420,000 in disgorgement and prejudgment interest.

Without admitting or denying the allegations, Mattes, an Austrian citizen has agreed to be enjoined from future similar violations and barred from being an officer or director of a publicly traded company in the U.S., and will pay more than $16 million in disgorgement and prejudgment interest plus a $640,000 penalty. The settlement is subject to court approval.

SEC v. Chad Starkey Jumio 33-10626
SEC v. Daniel Mattes Jumio comp-pr2019-50

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