The founder of an artificial intelligence company that supplied school districts in New York City, Los Angeles and Atlanta with a chatbot to create learning plans for students was arrested on fraud charges Tuesday, accused of spending investor money on herself as her company spiraled into bankruptcy.
She founded ALLHere Education Inc., an artificial intelligence technology company that created “Ed” the chatbot. The Los Angeles Unified School District was among those that used the product for a time before shutting it down, citing the financial collapse of Smith-Griffin's company.An indictment unsealed Tuesday in Manhattan federal court accused Smith-Griffin of making misrepresentations to investors that enabled her to collect millions of dollars illegally from them since 2020.
It says she used some of the fraudulently obtained money from investors to put a down payment on her home in North Carolina and to pay for her wedding. After the company collapsed and employees were laid off, it entered bankruptcy proceedings and a trustee took over its finances, authorities said.U.S. Attorney Damian Williams said in a release that she “orchestrated a deliberate and calculated scheme to deceive investors in AllHere Education, Inc.
He said her “selfishly prioritizing personal expenses” over the company's needs damaged the potential for improved learning environments across major school districts, according to the release.
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