The founder of an AI business once named to Forbes’ “30 Under 30” list was charged with scamming investors Tuesday.
Joanna Smith-Griffin, 33, the founder of AllHere Education, was arrested in North Carolina and charged with securities fraud, wire fraud, and identity theft.
U.S. Attorney Damian Williams of the Southern District of New York alleged that “Smith-Griffin orchestrated a deliberate and calculated scheme to deceive investors in AllHere Education, Inc., inflating the company’s financials to secure millions of dollars under false pretenses.” “The law does not ignore those who allegedly distort financial realities for personal gain.”
Prosecutors alleged Smith-Griffin defrauded investors by falsely claiming to have millions of dollars in revenue and relationships with major school districts such as the New York City Department of Education.
AllHere developed the “Ed” chatbot, which was later used by large school districts, including the Los Angeles Unified School District. On its website, LA schools stated that “Ed” is a “educational friend designed to help students reach their limitless potential,” and that it uses student data to build personalized learning programs for students.
Prosecutors also claim that Smith-Griffin “embezzled corporate funds for her own benefit,” such as making a downpayment on her home and paying for her wedding.
Before the accusations were filed, AllHere declared Chapter 7 bankruptcy and laid off employees. It is being overseen by a court-appointed bankruptcy trustee.
Her combined charges involve a potential sentence of more than 40 years. The aggravated identity theft charge carries a mandatory two-year sentence.
According to FBI Assistant Director in Charge James E. Dennehy, Smith-Griffin’s claimed activities “impacted the potential for improved learning environments across major school districts by selfishly prioritizing personal expenses.”
“The FBI will ensure that any individual exploiting the promise of educational opportunities for our city’s children will be taught a lesson,” Dennehy announced.