“Saniger marketed Nate as a mobile shopping application that used artificial intelligence to complete users’ purchases across a variety of retail platforms. While soliciting investors, Saniger touted the app’s purported reliance on AI, including machine learning and neural networks, to process transactions. But as Saniger knew or recklessly disregarded, the Nate app did not use AI to complete purchases.”

💡 This establishes the central lie that Saniger allegedly told investors for years while raising over $42 million.

“Saniger told one investor that the app’s automation rate was above 90% when in fact virtually all orders entered on the app at that time had to be placed manually, behind the scenes, by contract workers in the Philippines and elsewhere.”

💡 This shows Saniger allegedly provided specific false statistics to investors conducting due diligence.

“Saniger misrepresented to Series A investors that the Nate app functioned based on AI, including neural networks that understand HTML and transact on websites in the same way consumers do.”

💡 This technical claim was designed to impress sophisticated investors with advanced AI capabilities that did not exist.

“As a Nate automation employee confirmed for Saniger in a June 11, 2021 Slack message, Nate’s automation rate was essentially zero.”

💡 This internal communication proves Saniger knew the automation rate was zero right after closing the Series A Round where he claimed AI functionality.

“During the Relevant Period, Nate also conducted product demonstrations for investors that made it falsely appear that the app was automatically completing purchases, when in fact, at Saniger’s direction, Nate engineers and others worked behind the scenes to manually process the orders.”

💡 This reveals how Saniger allegedly directed employees to actively deceive investors during demonstrations.

“Saniger also provided Nate engineers with the email addresses for a VIP list of potential investors so that any orders later placed by those investors could be promptly completed through the manual involvement of Nate workers. This was similarly designed to give potential investors the false impression that the Nate app was functioning as claimed and autonomously completing the investors’ online purchases.”

💡 This shows premeditated deception targeting the most important investor prospects with fake automation.

“Saniger personally profited from his fraud, including by selling approximately $3 million of his own Nate shares to a Series A investor in June of 2021.”

💡 This demonstrates Saniger personally enriched himself from the fraud while investors later lost everything.

“Saniger instructed the automation engineering groups that they were not to report on the status of AI development to other Nate employees. As a result, most Nate employees lacked visibility into the status of the company’s AI technology.”

💡 This reveals deliberate compartmentalization to hide the truth from most company employees.

“Saniger also provided Investor A with written materials in the form of a pitch deck describing Nate as a digital assistant able to transact online without human intervention and as the first non-human executive assistant that can buy anything, anywhere.”

💡 The marketing materials explicitly promised no human intervention when the entire operation depended on manual human labor.

“After a news report cast doubts on Nate’s claimed use of AI in June 2022, Saniger failed to complete a Series B round, and the company ceased operations. Nate formally dissolved in January 2023, leaving investors with losses of substantially all their investments, totaling tens of millions of dollars.”

💡 This outcome shows investors lost essentially everything when the truth emerged, while Saniger had already extracted personal wealth.

“Based on Saniger’s communications with Nate’s engineering teams, he knew or recklessly disregarded, that, contrary to his representations to Seed Round investors, the Nate app did not use AI to complete purchases on the app and instead required manual processing for all transactions.”

💡 This establishes Saniger’s knowledge of the falsity of his claims through direct communications with engineers.

“By virtue of updates Saniger received from Nate’s engineering teams, Saniger was aware that, at the time of the Series A Round, Nate still lacked a working AI model for the app and continued to rely on manual processing of transactions. Nevertheless, Saniger falsely represented to prospective Series A investors that the app was using AI technology.”

💡 This shows the fraud continued and escalated into the larger Series A Round despite Saniger’s clear knowledge of the truth.