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The SEC has charged a former rising star VC, accusing him of 'misappropriating millions of dollars' and barred him for 5 years

The settlement comes two years after Rothenberg Ventures, a flashy VC firm, imploded under a cloud of controversy.

  • The SEC announced charges and a settlement with Michael Rothenberg, the founder of Rothenberg Ventures.
  • The SEC charged Rothenberg with overcharging investors to fund personal projects. Rothenberg did not admit or deny the allegations in the settlement.
  • Rothenberg will be barred from the brokerage and investment advisory business for five years.

Michael Rothenberg, the founder of a flashy San Francisco VC firm that imploded under a cloud of controversy in 2016, has settled charges with federal regulators alleging that he misappropriated millions of dollars from investors.

The SEC announced on Monday that it has charged Rothenberg with overcharging investors to fund personal projects, including a virtual reality company. The settlement includes barring Rothenberg from

Rothenberg Ventures was a high-flying venture firm that publicly imploded in 2016. It was known for its over-the-top parties and spending — as well as its young, charismatic founder, Mike Rothenberg. Back in 2016, theaccording to an email obtained by Business Insider

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On top of that, multiple employees filed wage complaints against the company with the state of California, several people told Business Insider, and they also cooperated with the SEC investigation.

One of them who was involved in this process told us, "

The firm, which had over $50 million under management, ran out of operating money, and all its employees except its lawyer were told they were put on "unpaid leave" a year ago, according to a lengthyaccount of the firm's troubleson Backchannel.

Business Insider talked to several former employees of the company who described their experiences with Rothenberg using words like "charming" and "convincing," "vengeful," "a messed-up human being," "megalomaniac," "master manipulator" and "lack of empathy."

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