Fintech Unicorn Array Misled Investors, Ex-Executive Says

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  • Array sells credit and identity protection products to other fintechs.
  • A former executive alleges the company rigged customers and inflated investors’ earnings.
  • A lawyer for Array denied the allegations and called the former executive “unhappy”.

A former executive at a fintech unicorn that provides credit scoring and identity protection products to other fintechs claims he tricked investors with fake sales records and sold consumer credit data to shady buyers.

Jason Owen, its former chief strategy officer, filed a lawsuit on March 29 alleging that Array “fabricated false or inflated earnings” in the run-up to its Series A run last year. Owen also said Array appears to have rigged clients in order to “create the false illusion” of the company’s success.

The lawsuit alleges that a supposed client whose monthly expenses with Array increased 25-fold as the company increased its Series A had nothing to do with finances and belonged to the father of an Array employee. The client was registered as Alpha Credit Group, but his mailing address matches a cafe in Monterey, California, owned by the employee’s father.

The lawsuit says the company also violated agreements with Experian, Equifax and TransUnion by selling sensitive consumer credit data to end users using predatory tactics, which were specifically prohibited by the terms of the agreements.

Owen alleges that Array CEO Martin Toha ousted him from management and fired him in October in retaliation after he “noticed financial irregularities in the books and records of the company and those of its subsidiaries.” . He also accused Toha of defrauding him of more than $70 million in equity after the company’s value skyrocketed in two successive funding rounds in 2021.

Owen’s lawsuit said investors including General Catalyst and Battery Ventures participated in the company’s Series A last year. His lawsuit said that in a Series B shortly thereafter, the company’s value fell from $250 million to $1.5 billion.

Array, which has not announced any fundraising, helps other fintechs provide credit scores and other financial widgets to their customers. Its website says it gets data from TransUnion, Equifax and Experian.

A 2021 article in Forbes that described Array as one of the “next billion-dollar startups” said Array’s customers include fintechs like SoFi and One. But Owen said some of his most lucrative clients were rent-to-own companies, credit repair companies and bankruptcy attorneys who paid a premium for access to credit data at the consumption to which they normally could not access. He accused Array of violating terms set by major credit bureaus by sharing it.

Owen’s lawsuit said Array gained access to credit bureau data through Pentius Inc., a company founded by Toha who describes himself as “a serial developer of web properties.”

Toha, General Catalyst, Battery Ventures and the Big Three credit bureaus did not respond to questions about the lawsuit.

Alex Spiro, an attorney for Quinn Emanuel who represents Array, told Insider the allegations were not true.

“These self-serving false claims first surfaced after Array refused to be shaken down by a disgruntled, fired employee,” he said in an email. “We will deal with the case in court.”

Joshua Berman, a White & Case attorney representing Owen, said he and his client supported the allegations and would not comment further.

Do you know more? Contact the reporter on this story, Jack Newsham, via Signal at 314-971-1627 using a non-work phone.

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