Just a few years ago, Silicon Valley venture capitalist Michael Rothenberg was on top of the world — almost literally.
The startup financier, still in his early 30s, was hosting clients at the Super Bowl, booking the San Francisco Giants’ baseball stadium for all-day events, and flying the favored few over Napa Valley vineyards in hot-air balloons.
Rothenberg, only a few years out of Harvard Business School, was an early-stage investor in new-wave fintech companies like Robinhood. He had attracted more than 200 people to invest in his funds. Bloomberg News ran a feature on him, calling him “The Valley’s Party Animal.”
Today, he’s reeling from a $31 million judgment in California federal court to settle allegations of fraud and misappropriation with the Securities and Exchange Commission. He must repay $18.8 million that he took from clients, plus nearly $3.7 million in interest and another $9 million as a civil penalty, the court ruled.
As part of the agreement, he neither denied nor admitted wrongdoing. The current charges were in civil court only; the SEC does not handle criminal charges. Rothenberg, now 36, has also been barred from the securities and brokerage industry for a minimum of five years.