Joonko files for Chapter 11, plans to distribute remaining $4.25 million to investors
Joonko files for Chapter 11, plans to distribute remaining $4.25 million to investors
The startup's operations effectively came to an end last summer after Ilit Raz, the former CEO of Joonko, left the company amid allegations from the board that she “engaged in egregious, unethical, and fraudulent conduct.” After leading the investigation on behalf of the investors and the management, COO Ilan Band is now seeking to complete the closure of the company
Israeli startup Joonko filed for Chapter 11 protection in the District of Delaware bankruptcy court last week. Joonko’s operations effectively came to an end last summer after Ilit Raz, the former CEO of Joonko, left the company amid allegations from the board that she “engaged in egregious, unethical, and fraudulent conduct.”
After leading the investigation on behalf of the investors and the management, COO Ilan Band is now seeking to complete the closure of the company, which laid off all its employees in the aftermath of the scandal.
According to Joonko’s filings with the Delaware court, the company raised a total of $29.5 million from investors between 2019 and 2022. It has $4.25 million remaining in its account and no significant outstanding debts. However, the company still faces legal action from some investors, as well as from Raz herself, who is suing the company for $300,000 to cover her legal expenses.
According to the filing, Joonko is under investigation by the U.S. Securities and Exchange Commission as well as the United States Attorney for the Southern District of New York.
Joonko, which was established in 2016 and employed around 50 people at its peak, developed a solution that assisted companies in achieving their diversity, equity, and inclusion goals.
According to the filing, an investigation was initiated last year after the company's investors became suspicious of Raz, leading them to request the hiring of a Chief Financial Officer and a Chief Operating Officer for the company, positions that had not previously existed. Raz had been avoiding appointing these senior officials for months until she finally complied with the board's demands. The investigation found that Raz forged hundreds of documents, including contracts, bank statements, and financial documents.
