Two Indian-origin men have been charged with financial fraud in Brooklyn.
The company, which was founded in 2010 and dissolved in 2025, was defrauding investors and shareholders with false revenue numbers and fake contracts. Two Indian-origin men have been charged with an elaborate financial fraud involving iLearning, a Maryland-based technology company that marketed itself as an “out-of-the-box artificial intelligence platform.”
Puttogramam “Harish” Chidambaran, founder and former CEO, and Mr. Farhan Ali “Farhan” Naqvi, former CFO of iLearning, were arrested on April 17 and produced in court. They exploited investor enthusiasm about the AI boom and told investors and lenders lies and inflated numbers, court documents said. The really made-up part of their story was their clients and revenue, said U.S. Attorney Nocella.
Company growth story
Founded in 2010, iLearning claimed to generate revenue primarily by selling licenses of its platforms to customers, and the company reported rapidly growing revenues of $421 million in 2023. In April 2024, iLearning became a publicly traded company and received $40 million in loan proceeds from the New York City branch of the financial institution. The company then obtained an additional $20 million in loan proceeds from another branch of a financial institution in New York City.
After going public, iLearning’s stock began trading on the Nasdaq under the ticker symbol “AILE,” and the company quickly achieved a market capitalization of approximately $1.5 billion.
Fake information, false contracts
Investors and lenders did not know that the company had fabricated all its revenues. The agreements they showed were mostly signed by family members. Court documents cited an example of the complex fraud.
At Chidambaran’s direction, an associate who previously served as iLearning’s vice president established and opened bank accounts in the names of several alleged iLearning clients. The two main defendants transferred millions of dollars from iLearning to an account controlled by this person.
This person then sent those funds to other accounts that he controlled in the names of other entities, before finally sending the funds to iLearning.
The total value of these round-trip transactions exceeded $144 million.In 2024, an investment research firm discovered the scam and published a report stating that iLearning had misrepresented its revenues, leading to a rapid decline in stock prices. iLearning eventually filed for Chapter 11 bankruptcy protection in the District of Delaware in December 2024, and the proceedings were later converted to Chapter 7 liquidation in 2025, marking the collapse of the company.
