Israeli AI startup founder pleads guilty to $27 million fraud scheme in New York

Ilit Raz, founder and former CEO of the Israeli AI startup Joonko Diversity, Inc., pleaded guilty to securities fraud in New York, admitting to defrauding investors of approximately $27 million between 2021 and 2022. Raz made false claims about Joonko's customers and revenue, stating the company had over 100 customers, including major global brands, and had worked with over 100,000 job candidates. She provided fabricated testimonials and forged bank statements and purchase orders to mislead investors. The scheme was uncovered in 2023 when an investor grew suspicious. Raz faces a maximum prison sentence of 20 years.