Facebook co-founder Saverin sued over Jumio bankruptcy

Facebook co-founder Saverin sued over Jumio bankruptcy

Facebook co-founder Eduardo Saverin is being sued by a shareholder in Jumio over alleged “misrepresentations and ineptitude” related to the digital ID verification outfit's bankruptcy filing earlier this year.

According to the Wall Street Journal, Bloso Investments has filed a complaint against Saverin and others, claiming that it is set to lose nearly $5 million it invested in Jumio thanks to its recently filed bankruptcy.

In the complaint, Bloso says that it made its investment in Jumio - which helps firms such as Airbnb verify payment card details online - based on revenue projections that “turned out to be incorrect and deliberate misrepresentations”.

A spokeswoman for Saverin - who is a Jumio shareholder, its largest creditor and former director - told the WSJ that the allegations are "baseless". She adds: "He was harmed as much as, if not more than, any other investor of the company by former management’s actions and is contemplating his own claims against them."

Despite raking in tens of millions of dollars in funding, last year Jumio was forced to restate its 2013 and 2014 financial reports. This saw funding dry up and led the firm to seek chapter 11 protection in March.

Bloso alleges that Saverin and others then tried to manipulate the bankruptcy to keep control of the company. Saverin made an offer for the firm but it was instead sold for a lower price of $850,000 to an affiliate of PE firm Centana Growth Partners.

Bloso says that it will oppose the bankruptcy, which goes to court for final approval next week.

Comments: (1)

Hitesh Thakkar
Hitesh Thakkar - SME - Fintech startups (APAC and Africa) - India 19 October, 2016, 14:35Be the first to give this comment the thumbs up 0 likes

Jumio has powerful ID offeing...sad to see the boat sinking.