Federal prosecutors have charged former Near Intelligence CEO Anil Mathews and former CFO Rahul Agarwal with orchestrating a scheme that inflated the data firm’s revenue by more than $37 million through fictitious transactions. MobileFuse CEO Kenneth Harlan also faces criminal counts for his alleged role in the round-tripping arrangement. Near Intelligence filed for Chapter 11 bankruptcy protection in Delaware in December 2023 and has since confirmed a plan of liquidation, leaving creditors and former employees to absorb the fallout from a company whose reported financials now appear to have been built, in significant part, on fabricated sales.
How inflated invoices preceded Near Intelligence’s collapse
The criminal case, filed by the U.S. Attorney’s Office for the Southern District of New York, alleges that Mathews, Agarwal, and Harlan ran a coordinated accounting fraud in which Near Intelligence and MobileFuse exchanged invoices for services that were never actually delivered. The DOJ announcement describes a round-tripping scheme: Near would bill MobileFuse, MobileFuse would bill Near, and the circular payments would be recorded as genuine revenue on Near’s books. The result was more than $37 million in inflated invoices and improperly reported revenue, according to the SEC’s parallel filing, which names Mathews, Agarwal, Harlan, and MobileFuse, LLC as defendants.
The timing of these alleged transactions raises a pointed question. Near Intelligence was a publicly traded data-intelligence company that needed to show growth to satisfy investors and maintain its market standing. If the round-tripping was timed to coincide with capital-raising efforts or valuation benchmarks, the scheme may have functioned less as a way to keep daily operations running and more as a tool to hit specific financial targets that justified the company’s equity price or debt covenants. The charging documents describe a pattern of deception aimed at investors, which is consistent with that reading, though the full indictment has not been released in unredacted form.
According to prosecutors, the mechanics were straightforward but potent. Near and MobileFuse allegedly agreed on sham contracts and invoices for advertising and data services that were never rendered. Money flowed back and forth between the two companies, but instead of being treated as offsetting or pass-through items, Near allegedly booked the incoming funds as top-line revenue. By repeatedly executing such transactions near quarter-end, the executives could purportedly smooth results, mask shortfalls, and present a narrative of steady expansion in a competitive digital advertising market.
Criminal and civil charges built on the same transaction trail
The enforcement actions run on two parallel tracks. The DOJ’s criminal case charges all three executives with conspiracy and fraud tied to the round-tripping arrangement. Prosecutors contend that misleading auditors and investors was not incidental but central to the strategy, with allegedly falsified contracts and backdated paperwork designed to withstand basic scrutiny.
Separately, the SEC’s civil complaint targets the same individuals plus MobileFuse as a corporate entity, focusing on the securities-law violations that flowed from reporting fabricated revenue in public filings. The $37 million figure cited by the SEC represents the total value of inflated invoices and improperly booked revenue across the scheme’s duration. Regulators allege that Near’s financial statements, earnings calls, and investor presentations all drew on these distorted numbers, depriving shareholders of an accurate picture of the company’s health and growth trajectory.
Beyond the headline revenue figure, the SEC also highlights alleged internal control failures. The complaint points to what it describes as inadequate oversight of related-party transactions, weak documentation standards, and a culture that rewarded headline growth without sufficient regard for the underlying economics. Those allegations, if proven, would underscore how accounting misconduct can flourish when governance structures fail to challenge aggressive revenue-recognition practices.
From Chapter 11 to liquidation
Near Intelligence’s bankruptcy filings fill in what happened after the alleged fraud. The company and certain subsidiaries voluntarily initiated Chapter 11 proceedings in the District of Delaware, entering a court-supervised process to sell remaining assets. A monthly operating report filed in the bankruptcy case on January 31, 2024, documented cash receipts and disbursements during the wind-down, reflecting a business that was no longer focused on growth but on preserving value for creditors while operations were pared back.
The Delaware bankruptcy court later confirmed a liquidation plan that effectively ended Near Intelligence as a going concern. Under that plan, the company’s remaining assets, including intellectual property and customer relationships, were to be sold or otherwise monetized, with proceeds distributed according to the priority scheme laid out in the Bankruptcy Code. Secured lenders and administrative creditors stand ahead in line, while unsecured creditors, trade vendors, and many former employees face the prospect of only partial recovery, if any.
For investors, the alleged fraud and subsequent collapse illustrate the compounding harm of distorted financial reporting. Inflated revenue can buoy a company’s market capitalization in the short term, support new fundraising, and justify acquisitions or hiring sprees. But once discrepancies surface-through regulatory scrutiny, auditor questions, or liquidity pressures-the correction can be swift and unforgiving, wiping out equity and leaving creditors to fight over what remains.
The Near Intelligence case also sends a broader signal to the ad-tech and data-analytics sectors, where complex revenue arrangements and opaque data flows can make it harder for outsiders to assess true performance. Regulators appear intent on demonstrating that traditional accounting rules still apply, even when services involve algorithmic targeting, mobile location data, or programmatic advertising. For executives and boards, the message is clear: aggressive growth narratives built on circular transactions and weak controls may not only fail to save a struggling business, they can also invite criminal charges and long-lasting reputational damage.
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Warren Cohen is a finance writer based in Phoenix, Arizona, covering personal finance topics including credit, banking, and beginner investing. He earned his degree in business administration from Arizona State University and began his career working in consumer finance, where he gained direct experience with lending and credit systems. He now writes for personal finance websites and fintech platforms, focusing on clear, practical content that helps readers make informed financial decisions.
