Feds, SEC Accuse App Maker of Fraud Over ‘AI’ Service Run by Philippine Workers

U.S. authorities have charged a tech app founder with fraud, accusing him of misleading users about his e-commerce app's capabilities. The app, marketed as being powered by artificial intelligence, was actually operated by human workers in the Philippines.

Albert Saniger, founder and former CEO of Nate, a company based in Barcelona, Spain, was charged with one count of securities fraud and wire fraud, according to a statement from the Justice Department on April 9. The Securities and Exchange Commission also filed a related civil action.

Court documents reveal that Saniger founded Nate in 2018 and launched the Nate app in July 2020. The app was promoted as an AI-driven universal shopping cart that could allow users to complete online transactions, including filling in shipping details and selecting sizes, without any human involvement.

However, the Justice Department claims that Saniger actually used hundreds of contractors, or "purchasing assistants," in a call center in the Philippines to manually process purchases made through the Nate app.

Source: US Attorney's Office, Southern District of New York

Investors reportedly gave Saniger over $40 million, according to federal authorities. Acting U.S. Attorney for New York, Matthew Podolsky, accused Saniger of deceiving investors by exploiting the appeal of AI technology to create a false narrative about innovation that never materialized.

Saniger allegedly raised more than $40 million from venture capital firms by promoting the app as AI-powered and instructed employees to conceal the true nature of Nate's automation. 

Podolsky emphasized, “This type of deception not only victimizes innocent investors, it diverts capital from legitimate startups, breeds skepticism about real innovations, and ultimately hinders AI development.”

While the company did acquire AI technology from a third party and had a team of data scientists working on it, authorities claimed the app never reached a point where it could reliably complete e-commerce transactions, with its actual automation rate being effectively zero.

During the 2021 holiday season, it’s claimed that Saniger directed Nate’s engineering team to create bots to automate certain transactions on the app, in addition to relying on human workers.

Nate shut down in January 2023, and Saniger reportedly fired all employees after media coverage raised concerns about the app's functionality, as stated in the SEC's court filing.

The charges of securities and wire fraud each carry a maximum penalty of 20 years in prison. The SEC’s lawsuit is also seeking a ban on Saniger from holding leadership roles in similar companies and demands the return of the investor funds.