Ilit Raz, the Israeli founder of the artificial intelligence hiring startup Joonko, has pleaded guilty to securities fraud in the United States. The plea resolves a federal criminal case centered on false statements about the company's customers and revenue. Prosecutors say the scheme enabled Raz to obtain roughly $27 million across two funding rounds.
The Scope of the Misrepresentations
According to the U.S. Attorney's Office for the Southern District of New York, Raz falsely told current and prospective investors that Joonko had a much larger customer base than it actually did. She claimed that major companies in credit cards, sports apparel, online travel and luxury fashion were customers. None of those businesses had a relationship with the startup.
The Two Funding Rounds
Prosecutors also said Raz made false statements about actual and projected revenue while raising money for Joonko. In June 2021, investors placed approximately $10 million in a Series A round, followed by another $17 million in a Series B round one year later. The two rounds together represent the $27 million that Raz allegedly obtained through the fraudulent scheme.
Investor Suspicions Grow
The case began to unravel in 2023 when an investor became suspicious about the company's performance and requested financial information. On April 3, Raz allegedly sent a purported bank statement showing an average balance of more than $5 million. Prosecutors say the document was forged and the actual balance was millions of dollars lower.
Fabricated Purchase Orders
Less than a week later, Raz allegedly sent the investor a collection of customer purchase orders. Many of those documents were fictitious, containing forged signatures and executed on behalf of companies with no business relationship to Joonko. Following an investigation, Raz was ousted, employees resigned and the company shut down its operations.
SEC Action and Bankruptcy
The criminal case is not the only legal action tied to Joonko's collapse. In June 2024, the U.S. Securities and Exchange Commission charged Raz with defrauding investors of at least $21 million. The SEC alleged inflated revenue, fake customer testimonials, forged bank statements and claims about a job seeker database that did not exist.
Bankruptcy Settlement
Joonko filed for Chapter 11 bankruptcy in May 2024 after raising nearly $30 million between 2019 and 2022. In June 2025, a Delaware bankruptcy judge approved a $500,000 settlement between the company and Raz. That agreement resolved outstanding disputes, including a $1.77 million claim for legal fees, but did not resolve the federal proceedings.
Plea and Potential Sentence
Raz, 40, has now pleaded guilty to one federal count of securities fraud in the Southern District of New York. The offense carries a maximum sentence of 20 years in prison, although any term will be decided by the court. Prosecutors stated that her now-bankrupt company left investors with millions of dollars in losses.
Ilit Raz's guilty plea brings a criminal conclusion to a high-profile startup collapse that drew scrutiny from investors, regulators and the public. The case underscores the broader legal risks associated with misrepresenting company performance during fundraising. With federal civil and criminal proceedings now advancing separately, the full consequences of the Joonko scheme will be determined by the courts.