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Fashion mogul and Project Runway judge 'googled how to commit fraud to pull off $300M scheme'
Fashion mogul and Project Runway judge 'googled how to commit fraud to pull off $300M scheme'

Daily Mail​

time2 days ago

  • Business
  • Daily Mail​

Fashion mogul and Project Runway judge 'googled how to commit fraud to pull off $300M scheme'

A fashion mogul and former Project Runway judge has been accused of a staggering $300 million fraud. Christine Hunsicker, 48, of Lafayette, New Jersey, is charged with six counts, including fraud, aggravated identity theft and false statement charge. Prosecutors say she forged documents and misrepresented her company's financial condition to defraud investors in her companies CaaStle Inc. and P180. Hunsicker created several fake audits for investors that showed the company had significantly more money available than it did, according to prosecutors. She was eventually confronted by another investor in October 2024 but feigned innocence, the indictment said. However immediately after the investor left, she googled 'faking an audit', according to the complaint. Her lawyers said that the indictment was a 'distorted picture' which they are keen to challenge in court. Before the fraud allegations emerged, Hunsicker seemed to be a rising star in the fashion world after she was named to Crain's New York Business '40 under 40' list. She was selected as one of Inc.'s Most Impressive Women Entrepreneurs and was recognized by the National Retail Federation as someone shaping the future of retail, the indictment noted. She also appeared as a judge on Project Runway in 2016 and has been pictured posing alongside Bill and Hillary Clinton. It is a far cry from the salacious allegations which appear in the indictment which narrates how she allegedly tried to cover up her tracks. Hunsicker created fake audits that showed CaaStle had $50million in cash available, when in reality it had less than $1million in August 2023, the indictment states. She also told investors that the shares they were buying were from other shareholders who were liquidating their assets, when in fact, those people didn't exist, the indictment said. She told them the shareholders were liquidating their assets due to a 'family health emergency' or do to the FTX collapse, which saw founder Sam Bankman-Fried sentenced to 25 years for also scamming his investors. 'To maintain the fiction, after facilitating the supposed secondary sales, HUNSICKER issued fake capitalization tables to the investors to demonstrate that they had purchased existing CaaStle shares,' the indictment, unsealed on Friday, said. The indictment said she portrayed CaaStle as a high-growth, private company with substantial cash on hand when she knew it faced significant financial distress. Hunsicker allegedly continued her fraudulent scheme even after the CaaStle board of directors removed her and prohibited her from soliciting investments or taking other actions on the company's behalf, the indictment said. She 'persisted in her scheme' even after law enforcement agents confronted her over the fraud, the indictment said. At a time when the business was in financial distress with limited cash available and significant expenses, CaaStle was valued by Hunsicker at $1.4billion, the indictment said. Hunsicker was lying to investors in February 2019 and continued to do so through this March, prosecutors alleged. She allegedly told one investor in August 2023 that CaaStle reported an operating profit of nearly $24million in the second quarter of 2023 when its operating profit that quarter was actually less than $30,000. The indictment alleged that she carried out the majority of the fraud by bilking CaaStle investors of $275million before forming P180 last year to infuse CaaStle with cash before its investors could discover her fraud. Through misrepresentations and omissions, she cheated P180 investors out of about $30million, the indictment said. It said CaaStle filed for Chapter 7 bankruptcy last month, leaving hundreds of investors holding now-worthless CaaStle shares. She self-surrendered on Friday and she faces up to 50 years in prison. Defense Lawyers Michael Levy and Anna Skotko said in a statement that prosecutors, 'have chosen to present to the public an incomplete and very distorted picture in today's indictment.' They added this is despite Hunsicker's efforts to be, 'fully cooperative and transparent' with prosecutors and the Securities and Exchange Commission. 'There is much more to this story, and we look forward to telling it,' they said.

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