Founder of IRL Social Media App Charged with $170 Million Investor Fraud: Department of Justice

The CEO of Get Together, the firm behind the social media app IRL, has been indicted by the Department of Justice on charges of defrauding investors in the company’s 2021 funding round. The accused is Abraham Shafi, 38, from Hawaii.

Shafi allegedly deceived investors about the financial expenditure of his company, concealing millions spent on incentive advertising to boost app installations before the Series C funding round. According to the DOJ, he disguised these expenses by invoicing them to another firm.

The indictment also accuses Shafi and his fiancée of using investor funds for luxury hotel stays, high-end clothing purchases, home furnishing retail expenses, art class fees, and extravagant wedding costs including travel and accommodation for guests.

Shafi had previously claimed that investors backed IRL due to its potential to rival social media giants like Facebook and Snapchat. Notable investors included Peter Thiel’s Founders Fund and venture firm Floodgate. Shafi’s co-founders at IRL included Scott Banister, a PayPal board member, and an early investor in Facebook among others.

Only Shafi was named in the DOJ indictment. He faces up to 20 years in prison for each count, according to the DOJ. Last year, Shafi faced charges from the Securities and Exchange Commission for the same scheme. Monique Winkler, director of the SEC’s San Francisco Regional Office, stated at the time that “Shafi took advantage of investors’ appetite for investments in the pre-IPO technology space and fraudulently raised approximately $170 million by lying about IRL’s business practices.”