- Array sells credit scoring and ID protection products to other fintechs.
- A former CEO alleges that the company has been counterfeiting customers and boosting income for investors.
- An Array lawyer denied the allegations, calling the former director “disgruntled.”
A former executive of a fintech unicorn that provides credit scoring and identity protection products to other fintechs claims it misled its investors with false sales data and sold consumer credit data to shady buyers.
Jason Owen, the former Chief Strategy Officer, filed a lawsuit on March 29 alleging that Array “produced false or inflated revenue” in the run-up to Series A last year. Owen also said Array appears to have faked customers to create “the false illusion” of the company’s success.
The lawsuit alleges that an alleged customer whose monthly spending at Array has increased 25-fold as the company increased its Series A has nothing to do with finances and is owned by the father of an Array employee. The customer was registered as Alpha Credit Group, but the mailing address matches a coffee shop in Monterey, California, owned by the employee’s father.
The lawsuit says the company also violated agreements with Experian, Equifax and TransUnion by selling sensitive consumer credit data to end users using predatory tactics, which were specifically prohibited by the terms of the agreements.
Owen alleges Array’s CEO Martin Toha fired him from management and fired him in October in retaliation for noticing “financial irregularities in the books and records of the company and those of its subsidiaries.” He also accused Toha of cheating him out of more than $70 million in equity after the company’s value skyrocketed during two consecutive funding rounds in 2021.
Owen’s lawsuit said investors, including General Catalyst and Battery Ventures, bought from the company in the Series A round last year. His lawsuit said that in a Series B shortly afterwards, the company’s value shot from $250 million to $1.5 billion.
Array, which has not announced either fundraising round, is helping other fintechs provide credit scores and other financial widgets to their clients. The website says it obtains data from TransUnion, Equifax and Experian.
A 2021 Forbes article that described Array as one of the “next billion dollar startups” said Array’s customers were fintechs like SoFi and One. But Owen said some of his most lucrative clients were rental companies, credit repair companies and bankruptcy attorneys who paid a premium to access consumer credit data they normally wouldn’t have access to. He accused Array of violating the terms of major credit bureaus by sharing them.
According to Owen’s lawsuit, Array accessed data from the credit bureaus through Pentius Inc., a company founded by Toha that describes itself as “a serial developer of web-based properties.”
Toha, General Catalyst, Battery Ventures and the three major credit bureaus did not respond to questions about the lawsuit.
Alex Spiro, an attorney at Quinn Emanuel who represents Array, told Insider the allegations were untrue.
“These false, selfish claims first emerged after Array refused to be shaken by a disgruntled and fired employee,” he said in an email. “We will settle the matter in court.”
Joshua Berman, an attorney at White & Case who represents Owen, said he and his client support the allegations and would not comment further.
Do you know more? Contact the reporter of this story, Jack Newsham, via Signal at 314-971-427 using a non-work phone.