U.S. law enforcement authorities last week arrested a former employee of a Seattle startup who allegedly funneled more than $2 million in company funds to his personal bank accounts.
John Whisenant, a former director at Seattle auto marketplace startup Tred, was arrested last week in Arizona and is scheduled to appear in federal court in Seattle later this month on wire fraud allegations.
Court documents reveal how Whisenant allegedly made at least 57 unauthorized transfers from Tred to 14 of his own bank accounts.
From June 2019 to at least November 2021, Whisenant created fictitious customer transactions or company expenses as part of a scheme to conceal the nature of the transfers and disguise them as legitimate business items, according to court documents. He also made unauthorized changes in the company’s QuickBooks records as an “additional layer of concealment,” the complaint notes.
The company’s bookkeeper raised suspicion in January 2022 after performing account reconciliations and finding unusual transactions. Whisenant continued to make fraudulent edits in the QuickBooks ledgers, according to court documents. He abruptly resigned one month later.
Spending activity from Whisenant’s deposit accounts during the time of his employment with Tred, cited in court documents, show multiple purchases for luxury vehicles, including $123,096 for a 2022 Audi E-Tron and $98,100 for a Tesla. He also purchased two airline tickets to Paris for himself and his significant other that cost nearly $23,000 each.
Whisenant joined Tred in October 2018 and was promoted to director of marketplace operations a few months later.
We’ve reached out to the law firm representing Whisenant and will update this story if we hear back. Update: The firm declined to comment.
Founded in 2012, Tred aimed to make the process around buying and selling used cars faster and easier. The company raised $25 million in September 2021 and was acquired in September of last year by Cox Automotive, the parent company of Autotrader and Kelley Blue Book. The acquisition price was not disclosed. Tred is now branded as Private Seller Exchange.
Tred founder Grant Feek declined to comment for this story.
Read the full complaint below.
Former director of Seattle startup accused of embezzling $2M in company funds by GeekWire on Scribd
