CEO Faked $80 Million Deals, Crashed Valuation $800 Million!

SEC v. Manish Lachwani — U.S. Securities and Exchange Commission Litigation Release No. 26647, dated September 24, 2026.

The SEC charged Manish Lachwani, former CEO of HeadSpin, with an $80 million offering fraud. He allegedly inflated the company's valuation by overstating customer deals and creating fake invoices. Lachwani consented to a final judgment barring him from future securities offerings and imposing an officer and director bar.

In Plain English

Imagine a CEO who wanted his company to look super successful. He made up fake sales and changed real invoices to make it seem like they had way more money coming in than they actually did. This made the company look worth over a billion dollars! When the truth came out, the company's value dropped significantly. Now, he's banned from leading public companies and selling securities.

Disclaimer: all facts are drawn from the SEC's own filings; the claims described are allegations unless and until a court rules or the parties settle, and some cases end in dismissal.

How the Alleged Scheme Worked

1. Inflating Company Value From at least 2018 through 2020, Manish Lachwani, the CEO of HeadSpin, allegedly engaged in a fraudulent scheme to significantly inflate the company's valuation. He aimed to push the company's worth to over $1 billion.
2. Falsifying Customer Deals Lachwani allegedly inflated the value of numerous customer deals. He treated discussions about potential deals as if they were guaranteed future payments, even when they were not.
3. Doctoring Invoices To conceal the inflation, Lachwani allegedly created fake invoices. He also altered real invoices to make it appear that customers had been billed higher amounts than they actually were.
4. Internal Investigation Uncovers Fraud The fraud began to unravel after HeadSpin's Board of Directors conducted an internal investigation. This investigation revealed significant issues with the company's reporting of customer deals.
5. Valuation Revision As a result of the internal investigation, HeadSpin's valuation was drastically revised downwards. It was reduced from an alleged $1.1 billion to $300 million.

The Enforcement Action

On September 24, 2026, the SEC filed a consent and proposed final judgment as to Manish Lachwani. The SEC's complaint, filed on August 25, 2021, alleged that from at least 2018 through 2020, Lachwani engaged in a fraudulent scheme to propel HeadSpin’s valuation to over $1 billion by falsely inflating the company’s key financial metrics and doctoring its internal sales records. Lachwani consented to the entry of a final judgment that permanently enjoins him from violating Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and from participating in the issuance, purchase, offer, or sale of any security except for purchasing or selling securities for his own personal accounts, and imposes an officer and director bar.

Named in this action: Manish Lachwani.

Original SEC litigation release ↗ · Browse all cases