The SEC accused a fintech founder of fraudulently pocketing $60 million through a SPAC merger by lying about his trade finance platform's performance.
The Securities and Exchange Commission sued Srinivas Koneru on November 7, alleging he deceived investors to secure approval for the November 2020 merger between his company, Triterras Fintech, and Nasdaq-listed special purpose acquisition company Netfin Acquisition Corp.
Koneru, 65, made numerous false statements about Kratos, his online commodities trade and finance platform, to convince Netfin shareholders to approve the deal rather than redeem their shares at around $10 each, according to the filing in Manhattan federal court.
The scheme netted Koneru $60 million in cash and control of the merged company, while investors who stayed in the deal ultimately lost nearly everything, the SEC said.
At the heart of the alleged fraud was Koneru's misrepresentation of how Kratos actually worked. He pitched the platform as solving a $1.5 trillion funding gap for small and medium-sized commodity traders by connecting them with institutional lenders through the platform's Trade Finance module.
Koneru told investors that by August 2020, Kratos had onboarded ten lending funds with billions of dollars in assets under management and facilitated $1.1 billion in trade financing, the SEC said.
But those claims were largely fiction, according to the regulator. Only about 10 percent of the reported Trade Finance volume actually involved the ten purported lenders. The remaining 90 percent consisted of ordinary credit extensions between trading partners—not third-party financing at all.
Even worse, the limited activity that did involve the ten funds went almost entirely to companies Koneru controlled, including Rhodium Resources and a Koneru-owned trade finance fund called TAPL LP Interest Ltd., the agency alleged.
Nearly 40 percent of all Trade Finance volume from the module's February 2020 launch through August 2020 involved Rhodium lending to its own trading partners, facts Koneru hid from investors and failed to properly disclose as related-party transactions, according to the SEC.
Much of the lending that did occur with the ten funds had been arranged off the platform entirely. Koneru then directed employees to add these old loans to Kratos after the fact, making them appear as fresh platform-generated business, the regulator said.
For example, in July 2020, Koneru emailed one lender asking it to use Kratos to "approve the trades that have already been disbursed," telling the lender it would "help us tremendously," according to the filing. About $65 million in historical financing from that lender to Rhodium was then recorded on Kratos as though it were new August or September 2020 activity, even though the actual disbursements had occurred months earlier.
The deception worked. On November 10, 2020, Netfin shareholders overwhelmingly approved the merger, with less than 3 percent redeeming their shares. Koneru walked away with $60 million in cash and a 61.2 percent stake in the newly public Triterras, becoming its CEO and executive chairman.
The company's shares and warrants started trading on Nasdaq the next day. But the misleading statements continued even after the merger closed, the SEC said. Through at least February 28, 2021, the ten lending funds provided no financing through the Trade Finance module except to Triterras-related parties.
Reality eventually caught up with the stock price. By June 2022, Nasdaq had delisted Triterras, and shares were trading over the counter for less than $1. In 2025, all public securities were bought out at 10 cents per share by a company controlled by Koneru and Netfin's former CEO.
The SEC charged Koneru with violating antifraud provisions of federal securities laws. The agency is seeking to bar him from serving as an officer or director of any public company, force him to give up his gains plus interest, and hit him with civil penalties.
Koneru has not yet responded to the allegations. The SEC has demanded a jury trial.
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