Fashion startup founder charged with $300 million fraud

By LARRY NEUMEISTER NEW YORK AP A former chief executive of two clothing equipment companies who was once portrayed as an on-the-rise fashion entrepreneur has surrendered to face charges in an indictment unsealed Friday alleging that she cheated investors of over million over the last six years Related Articles St Paul to host Transplant Games Trump offers regulatory relief for coal iron ore and chemical industries Vested interests Influence muscle At RFK Jr s HHS it s not pharma It s wellness Trump signs new stablecoin regulations into law a major milestone for crypto industry M raises profit outlook in defiance of tariff impact Christine Hunsicker of Lafayette New Jersey was charged with six counts including fraud aggravated identity theft and false report charges in the indictment in Manhattan federal court U S Attorney Jay Clayton disclosed in a release that Hunsicker forged documents fabricated audits and made material misrepresentations about her company s financial condition to defraud investors in CaaStle Inc and P The indictment declared she portrayed CaaStle as a high-growth private company with substantial cash on hand when she knew it faced important financial distress In a message defense lawyers Michael Levy and Anna Skotko commented prosecutors have chosen to present to the population an incomplete and very distorted picture in in the modern day s indictment despite Hunsicker s efforts to be fully cooperative and transparent with prosecutors and the Securities and Exchange Commission There is much more to this story and we look forward to telling it they revealed According to the indictment Hunsicker continued her fraudulent scheme even after the CaaStle board of directors removed her and prohibited her from soliciting investments or taking other actions on the company s behalf She persisted in her scheme even after law enforcement agents confronted her over the fraud the indictment disclosed Before the fraud claims emerged Hunsicker seemed to be a rising star in the fashion world after she was named to Crain s New York Business under lists was selected as one of Inc s Most of Impressive Women Entrepreneurs and was recognized by the National Retail Federation as someone shaping the future of retail the indictment noted At a time when the business was in financial distress with limited cash available and important expenses CaaStle was valued by Hunsicker at billion the indictment noted Hunsicker was lying to investors in February and continued to do so through this March prosecutors alleged They disclosed she fed investors falsely inflated income statements fake audited financial statements fictitious bank account records and sham corporate records She allegedly notified one investor in August that CaaStle communicated an operating profit of nearly million in the second quarter of when its operating profit that quarter was really less than The indictment alleged that she carried out the majority of the fraud by bilking CaaStle investors of million before forming P last year to infuse CaaStle with cash before its investors could discover her fraud Through misrepresentations and omissions she cheated P investors out of about million the indictment reported It noted CaaStle filed for Chapter bankruptcy last month leaving hundreds of investors holding now-worthless CaaStle shares