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The latest charges laid against former Springleap founder Eran Eyal are not the first time he has had trouble with the law.
Eyal, who currently resides in the Brooklyn in the US, appeared before New York State Attorney General Barbara Underwood last Friday. The charges were contained in a statement on Saturday (25 August) by Underwood.
Last year a case was lodged against Eyal in a Khar police station in India, by a Mumbai businessman in connection with a $50,000 investment that he alleges was cheated out of him. The case was lodged after a court order from the Bandra magistrate’s court.
The Times of India in 7 June last year reported that an Indian the businessman alleged that he was duped out of $50,000 he invested in Springleap
The Indian businessman’s case is in addition to the latest charges pertaining to four investors who it is alleged invested a total of over $600,000 in Springleap and never received any of their money back.
A news report by the Times of India in 7 June last year reported that the businessman, Rupinder Singh Arora alleged that he was duped out of $50,000 he invested in Springleap via US-based angel investment group Cross Border Angels.
The police were ordered by the court to probe Eyal and his former business partner Trevor Wolfe (who said today he was mistakenly included in the legal action — see his response below) — as well as three executives from the angel investment group as being behind the deal.
The Times of India reported that the Indian businessman made the investment in Springleap via the angel investment group in 2015 when he was promised a return of six times his investment within six months.
In March 2016 he received a message from one of the executives at the investment group that Springleap no longer existed and that all the funds had been siphoned off by Eyal. The businessman lodged a case after promises from the executive to pay back the money were not honoured.
In addition, Mumbai publication The Afternoon Despatch and Courier reported on 5 June last year that Arora alleged that the angel investment group had told him that big names such as Nestle, Vodafone and Unilever had invested in Springleap — when there were no other investors.
Ventureburn contacted Arora. He said the case has yet to come to trial.
“Two of the accused (officers of CBA) Mandar Gadkari and Ashwin Sanzgiri are out on bail. The CBA Founder Kaushal Chokshi is next on the list once the police traces him.
He said the charges were filed by the Khar Police in the criminal court. “Unfortunately, the process in India is slow,” he added.
“Since Eran Eyal and Trevor Wolfe don’t visit India, it’s difficult to nab them. I hope the US authorities take action against Eran Eyal and South African authorities against Trevor Wolfe,” he said.
I was incorrectly named – Wolfe
Ventureburn spoke to Wolfe who claims he was incorrectly named in the charges, because he wasn’t yet a full shareholder of the company (in a subsequent email he claimed it was because he was not a founder and because he was not responsible for soliciting money from Mr Arora).
During a call with Ventureburn he clarified that he had 5% in share options in Springleap, until the company took the decision to shut down in 2016.
Wolfe said there were 12 employees in the company and that the New York Attorney General’s office contacted all shareholders, former employees and investors after receiving a complaint alleging fraud.
“Everyone co-operated,” added Wolfe, who said he represented marketing and sales in the business and that he was one of the last employees to leave the company when it shut down.
In an emailed statement later to Ventureburn, Wolfe said that though Arora stated his name in his complaint and reiterated it to Ventureburn, “his frustration is misguided”.
“I was not a founder of Springleap and had no role in soliciting investment from Mr Arora. I was never contacted regarding any complaints or charges filed by Mr Arora,” he said.
Said Wolfe: “Though I was not involved in soliciting his investment, I understand Mr Arora’s frustration. We were all misled by Eran — investors, employees and clients. I have never been contacted regarding any complaints filed against me.”
This a developing story.
Read more: Investor gatvol over losing R8.5m to Springleap through ‘misrepresentation’
Read more: Springleap charges: Are claims as world’s 7th most innovative firm a fabrication? [Updated]
Read more: SA entrepreneur Eran Eyal charged with fraud in the US over startup Springleap
Read more: Springleap’s Trevor Wolfe talks agencies, startups, and pivots [Q&A]
Read more: Springleap’s new Creatives Insights platform helps brands expand to foreign markets
Read more: Springleap goes big: expands into Middle Eastern, pan-African markets
Read more: SA crowdsource design startup Springleap secures R4m+ Angel round
Read more: Life after t-shirts: Ventureburn gets the exclusive behind Springleap’s pivot
Editor’s note (30 August 2018): Trevor Wolfe delvv.io CEO called Ventureburn and clarified that though he had share options in Springleap these had not yet vested, which meant he wasn’t yet a full shareholder.
Wolfe subsequently emailed a statement to Ventureburn, which has been included in the updated version of the story, above.
In the statement he said that though Arora stated his name in his complaint and reiterated it to you, “his frustration is misguided” and that he was was not a founder of Springleap and had no role in soliciting investment from Mr Arora.
Featured image: Former Springleap founder Eran Eyal (via Facebook)