CHICAGO -- Outcome Health and its former executives, Rishi Shah and Shradha Agarwal, were shining stars in Chicago's tech scene.
There were plans to put the company's name on a skyscraper. A fund co-founded by J.B. Pritzker and units of Goldman Sachs and Google made investments in the company. Shah was the youngest newcomer to the Forbes 400 list of the richest Americans in 2017, ranked No. 206 with a net worth of $3.6 billion.
Now, the former CEO and the former president, along with two other executives, face criminal charges for their alleged roles in a nearly $1 billion fraud scheme at the company, which installs screens and tablets in doctor's offices and waiting rooms that run pharmaceutical ads and educational content.
A criminal indictment unsealed Monday in U.S. District Court charges the four with a combined 26 counts of fraud. The most serious charges carry up to 30 years in prison if convicted.
The charges allege the former executives ran a massive fraud scheme that brought in $487.5 million in financing, a $110 million loan and a $375 million loan, amounting to nearly $1 billion. The indictment also alleges the executives lied to clients and billed them millions of dollars for ads that never ran.
Also charged Monday was Brad Purdy, who held various roles including chief financial officer and chief operating officer until he left Outcome Health in early 2018. Criminal charges were filed last week against the fourth former executive, Ashik Desai, and two of his subordinates.
In separate statements Monday, attorneys representing Agarwal, Shah and Purdy said their clients denied the charges. An attorney representing Desai declined to comment.
Outcome Health was founded in 2006 as ContextMedia, when Shah, now 33, and Agarwal, now 34, were students at Northwestern University. Pharmaceutical companies pay Outcome Health to run the ads and other content on the screens.
The company became a local success story, and Shah and Agarwal mentored other Chicago entrepreneurs and invested in startups. Outcome gained widespread attention in 2017 when it secured funding from big-name investors and rose to a valuation of about $5.5 billion, a number unmatched among Chicago tech companies.
Shah made the Forbes 400 list as a 31-year-old that same year. It also, according to the indictment, is when the alleged yearslong scheme began to unravel.