NS8 founder and former CEO Adam Rogas has been the subject of regulatory action by the federal securities regulators, and is being investigated by the investor rights lawyers at the Rosca Scarlato LLC law firm.
The Securities and Exchange Commission (SEC) filed an emergency action on September 17, 2020 against Adam Rogas, the founder and former CEO of NS8, a Las Vegas based technology company that purportedly aims to provide fraud detection and prevention software to e-commerce merchants.
Securities lawyers at the Rosca Scarlato LLC law firm are actively reviewing the NS8 investigation and strongly encourage NS8 investors who are concerned they may have suffered losses to contact investors right attorney Alan Rosca to seek recovery. Call 888-998-0530, send an email to arosca@rscounsel.law, or fill out the contact form on this webpage.
The emergency action is seeking an asset freeze and charging Rogas with allegedly defrauding NS8 investors in at least two securities offerings. Rogas allegedly falsified NS8’s bank statements to show millions of dollars in payments from customers.
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Adam Rogas, CEO of NS8 Allegedly Arrested and Charged for Fraud
A criminal complaint filed under seal is alleging that Adam Rogas engaged in securities fraud, fraud in the offer or sale of securities, and wire fraud. The complaint goes on to detail that Rogas operated a fraudulent scheme by allegedly misrepresenting NS8’s assets and revenue through falsified records. The purported inflated numbers were allegedly used to deceive investors and auditors.
According to the NS8 Investigation led by securities lawyer Alan Rosca, the SEC’s complaint and the criminal complaint revealed that from at least 2018 through June 2020, in at least two securities offerings, Adam Rogas allegedly provided NS8 investors and prospective investors with false financial statements showing millions of dollars in revenue and assets.
Rogas allegedly sent monthly falsified bank statements and revenue figures to NS8’s financial department, and used it to prepare NS8’s financial statements. As a result of Adam Rogas fraud allegations, the SEC reports NS8 raised approximately $123 million in 2019 and 2020, and Rogas pocketed at least $17.5 million of investor funds, all according to the SEC.
NS8 maintained two bank accounts, one account with Silicon Valley Bank and another with Bank of America, the complaint states. The account at Silicon Valley Bank was allegedly used to pay NS8’s business expenses and receive some investor funds; several NS8 employees had access to this account. The account with Bank of America was allegedly used to collect revenue from NS8’s customers; only Rogas had access to this account, the SEC reports.
Rogas perpetrated the alleged fraud against investors in 2019 and 2020 offerings. In addition, Rogas allegedly misrepresented NS8’s total assets by tens of millions of dollars, including an over $60 million inflation of assets in June 2020.
In November 2019 and March 2020, the SEC staff ordered Adam Rogas to appear in court in connection with an investigation into potential fraudulent conduct in a prior NS8 securities offering, the SEC records state. Despite the SEC’s subpoena, Rogas allegedly continued to falsify bank statements until at least June 2020.
The SEC filed its complaint in the U.S. District Court for the Southern District of New York, charging Adam Rogas with violating federal securities laws’ anti-fraud provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934. Rogas has been arrested and charged with securities fraud, wire fraud, and fraud in the offer and sale of securities. The SEC is seeking injunctions, disgorgement of allegedly ill-gotten gains with prejudgement interest, and financial penalties.
Investors who are concerned they suffered a loss as a result of NS8’s alleged fraudulent offerings are encouraged to contact an attorney at Rosca Scarlato LLC law firm for a free case evaluation or to provide any useful information to assist the NS8 Investigation. Attorney Alan Rosca and his colleagues may be reached at 888-998-0530, via email at arosca@rscounsel.law, or through the contact form on this webpage.
NS8 Filed for Chapter 11 Bankruptcy
As stated by the SEC, $72 million of the $123 million obtained from investor funds based on false bank statements were used to finance a tender offer and repurchase of investor shares, the NS8 Investigation reveals. In early September 2020, Rogas allegedly resigned from NS8 after an employee of NS8’s finance department discovered the true balance of funds in the company’s revenue account. Soon after, NS8 allegedly laid off most of the staff due to financial troubles.
Generally, a Chapter 11 bankruptcy allows a company to continue operations while reorganizing its obligations as well as give a company time to assess finances and negotiate with creditors to resolve outstanding debt. NS8 received a $10 million loan from investment firm, Invictus Global Management in order to fund litigation and the bankruptcy proceeding.
Prior to the loan, NS8 allegedly had approximately $28,000 left in its account. By June 2020, Adam Rogas allegedly created the illusion that NS8 had over $62 million in the revenue account, when it only had $28,000, according to the SEC.
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SEC is Seeking An Order to Freeze Adam Rogas’ Assets
According to the SEC Complaint, Rogas violated antifraud provisions of federal securities laws. The Commission is seeking an emergency court order to freeze his assets. As stated by Kurt L. Gottschall, Director of the SEC’s Denver Regional Office in a press release:
“As alleged in our complaint, Rogas falsely presented NS8 as a successful business by fabricating revenue figures and providing them to investors. Investors are entitled to accurate information about a company’s financial condition and the SEC is committed to holding accountable corporate executives who deceive investors.”
Securities Lawyers Reviewing Potential Recovery Options for NS8 Investors
The Rosca Scarlato LLC securities lawyers have extensive experience representing investors who lose money as a result of investment fraud and are currently investigating NS8 and CEO Adam Rogas’ alleged defraud of $123 million in fraudulent offerings. Attorney Alan Rosca and his colleagues are are interested in discussing with investors who are concerned about their NS8 investments or who believe they can assist the NS8 Investigation with useful information. All consultations are free.
The firm takes most cases of this kind on a contingency fee basis and advances the case costs; payments for their fees and costs only come out of money recovered for clients. Securities lawyer and adjunct professor of securities regulation, attorney Alan Rosca has represented thousands of victimized investors, both in the United States and around the world, in cases ranging from arbitrations to class actions.
NS8 investors who believe they may have experienced loss as a result of the NS8’s alleged fraudulent offerings may contact attorney Alan Rosca or his colleagues for a free, no-obligation evaluation of their recovery options. Call 888-998-0530, email arosca@rscounsel.law, or use the contact form on this webpage to get in touch.
