Federal prosecutors in Manhattan have charged the founder of Linqto Inc., a now-bankrupt platform that let ordinary investors buy shares of private companies before they went public, with running a $450 million scheme that allegedly inflated prices on securities investors thought they were buying at fair market value.
William Sarris, 75, who founded the Silicon Valley platform and served as its CEO for 14 years, was charged with six counts including securities fraud, wire fraud, broker-dealer fraud, and conspiracy. Joseph Endoso, 66, who succeeded Sarris as CEO after serving as company president, has pleaded guilty to securities fraud, broker-dealer fraud, and conspiracy, and is cooperating with prosecutors.
Markups of 60 percent, and sometimes far more
Prosecutors allege that between 2020 and 2025, Linqto customers were overcharged for stakes in private companies through manufactured scarcity and a manipulated internal pricing model. The median markup charged to customers was 60 percent, according to the government, with some transactions carrying markups exceeding 200 percent above what Linqto itself had paid for the shares.
Linqto marketed itself as a way for everyday investors to get in early on companies before a traditional initial public offering, a corner of the market that has drawn growing regulatory attention as more retail money flows into private securities that carry far less price transparency than public markets. The company filed for bankruptcy amid the unraveling of the alleged scheme.
Sarris has not entered a plea. If convicted on all counts, he faces decades in federal prison. Endoso’s cooperation agreement suggests prosecutors are continuing to build the case against remaining defendants and could bring additional charges as the investigation proceeds.
Sources: The Washington Times · Business Recorder
Related from BeezLoop: SEC Charges Former Bay Area Lending Executives With $80 Million Ponzi-Like Scheme Targeting… and Travis Kelce Was a Victim of a $35 Million Ponzi Scheme.
