do son 
In a case underscoring the dangers of deceptive corporate practices in the tech world, Paul Roberts, the founder and former CEO of Kubient, Inc., has been sentenced to one year and one day in prison for orchestrating a securities fraud scheme that inflated his company’s financial profile through fabricated revenue and false claims about its flagship AI product.
The sentence, handed down by U.S. District Judge Jennifer L. Rochon, follows Roberts’s guilty plea and caps a fall from grace for the onetime head of a promising digital advertising technology firm that once traded on Nasdaq.
“Paul Roberts cooked the books. He lied to investors and auditors about his company’s revenue and about his company’s premier product: an AI-powered tool that, ironically, was supposed to detect fraud in the digital advertising industry,” said Acting U.S. Attorney Matthew Podolsky. “This Office is committed to holding corporate executives who defraud the investing public accountable for their crimes.”
According to court documents, from October 2019 through March 2021, Roberts engineered a fictitious $1.3 million transaction between Kubient and another digital ad company, referred to only as “Company-1.” The deal was structured to appear as a reciprocal exchange of services—specifically, Kubient was to use its proprietary fraud detection platform, Kubient Artificial Intelligence (KAI), to analyze data and report on ad fraud. However, the services were never rendered by either party. Instead, both companies paid each other nearly identical amounts, and Kubient falsely recognized the revenue on its books.
This $1.3 million—an amount that made up more than 94% of Kubient’s reported revenue for 2020 at the time of its IPO—was used to mislead both auditors and the investing public. To further cover his tracks, Roberts instructed employees to fabricate KAI performance reports using invented metrics with no data behind them. These falsified documents were submitted to Kubient’s independent auditors to support the bogus revenue recognition.
But the deceit didn’t stop there. Roberts “repeatedly made material misrepresentations” in SEC filings and auditor communications, particularly around the functionality of KAI. Positioned as a groundbreaking AI-powered fraud detection tool, KAI was touted as a key differentiator in the crowded ad tech market. In reality, the system’s capabilities had been grossly overstated.
Fueled by these misrepresentations, Kubient successfully raised over $12.5 million in its August 2020 initial public offering and an additional $20 million in a December 2020 secondary offering. With investors drawn in by the illusion of innovation and financial growth, Kubient’s shares began trading publicly—only for the company to ultimately collapse. Today, Kubient is in Chapter 7 bankruptcy proceedings.
In addition to his prison sentence, Roberts, 48, of Melville, New York, was also sentenced to one year of supervised release.
The case serves as a stark reminder of how technological buzzwords like “AI” can be manipulated to lure investors, and how even the most promising innovations can be undermined by fraud from within. As prosecutors made clear, this was not a victimless crime—it was a deliberate effort to manipulate public markets and erode investor trust under the guise of artificial intelligence.
