SEC Alleges Founder of Tax Software Company Committed Fraud Against Investors

Social media and other nontraditional methods of reaching people have become so influential that many Americans make significant decisions based on what they see online. This includes choices on how to invest their money. Accountant Shiloh Luckey developed a substantial TikTok following, which could have helped raise money for the company she founded, ComplYant App, Inc. The startup offering an online tax-management platform allegedly raised more than $13 million between 2020 and 2023.

Though accountants are bound to be honest and accurate in their presentation of financial data, the Securities and Exchange Commission has accused Luckey of numerous misrepresentations while trying to attract investors. According to the SEC’s complaint, Luckey told venture capital firms and others that monthly revenues had grown from roughly $2,500 to over $250,000 in an approximate two-year period. This purported increase was explained by statements claiming dozens, or even hundreds, of new subscribers were signing up every month. 

In reality, the SEC says that the average number of signups within a given month was closer to four. The revenue numbers were similarly inflated according to the complaint. The SEC further alleges that Luckey misrepresented being a licensed CPA and diverted at least $2.2 million of investor funds for personal use, including a home purchase, Super Bowl tickets and a destination wedding.

Even sophisticated investors can have trouble discerning the difference between an authentic opportunity and a someone making a series of unsupported claims. As most of us know, false statements on social media platforms usually go uncorrected. Unfortunately, when these representations are designed to lure investors, people who believe the falsehoods could incur substantial financial harm.  

Whistleblowers with personal knowledge of fraud are often the key to stopping illegal schemes. The SEC Whistleblower Program offers confidentiality (including anonymity when represented by counsel) and robust anti-retaliation protections, along with the potential for significant monetary awards when tips lead to successful enforcement.

Kardell Law Group is a leader in the whistleblower representation. If you’re aware of fraud against potential investors or the government, we’ll examine the facts of your case and explain how you might obtain a reward by reporting the misconduct.