Indonesia court jails ex-chief executive of tech startup eFishery for 9 years for embezzlement

A Bandung court has delivered a significant blow to the Indonesian tech scene, sentencing Gibran Huzaifah, the former chief executive and co-founder of the once-promising agritech startup eFishery, to nine years in prison. The charges of embezzlement and money laundering stem from serious financial misconduct that came to light in late 2024, tarnishing the reputation of a company that had achieved a $1.4 billion valuation.

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Judges at a court in the Indonesian city of Bandung handed the nine-year prison sentence to Gibran on Wednesday (Apr 29), a verdict sheet published on the court's website showed.

The verdict follows a police investigation initiated in 2024 after complaints were filed by victims. While Huzaifah has admitted to manipulating eFishery's financial statements, he has maintained his innocence regarding the theft of funds. This distinction, however, was not enough to sway the judges, who handed down the substantial prison sentence. The case highlights the risks associated with rapid growth and high valuations in the startup ecosystem, particularly when internal controls and transparency are compromised.

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Police have been investigating the case since 2024, when a complaint was brought against Gibran and another individual identified only by his initial, C, for misconduct at eFishery.

eFishery's fall from grace has been dramatic. After presenting itself as a disruptive force offering fish and shrimp farmers an integrated platform for feed, financing, and market access, the company suspended Huzaifah over revenue irregularities. This led to widespread layoffs and the appointment of a consulting firm to manage the company. An internal probe revealed that the company had inflated its accounts, resulting in hundreds of millions of dollars in investor losses. Prominent investors like Japan's SoftBank and Singapore's Temasek are now facing the consequences of this internal fraud, underscoring the importance of robust due diligence in venture capital investments.

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In an interview with Bloomberg, he admitted to manipulating eFishery's financial statements, but denied stealing any money.