Fashion tech founder sentenced to prison for $300m fraud scheme

A fashion tech founder was sentenced to five years in federal prison for her involvement in a $300m “fraud scheme” spanning from 2019 to 2025, the Manhattan US attorney’s office announced on Thursday. Christine Hunsicker, 49, was also sentenced to three years of supervised release.Hunsicker, the founder and ex-CEO of CaaStle Inc, had pleaded guilty this March to one count of securities fraud in relation to a scheme that “defrauded hundreds of investors”, authorities said. Her attorneys did not immediately respond to a request for comment.Hunsicker, a “well-known entrepreneur and businessperson in the fashion-tech industry”, touted CaaStle as a fast-growing business with a valuation of more than $1.4bn, the southern district of New York prosecutor’s office said. But Hunsicker knew that the company was reeling “in financial distress with dwindling cash and significant expenses”.Hunsicker gave investors a slew of phoney documents to raise money for CaaStle, such as “falsified income statements, fake audited financial statements, fictitious bank records, and sham corporate documents” that dramatically exaggerated the company’s profits and cash reserves. Although Hunsicker told investors that their money would be directed toward buying discounted shares from then-shareholders, prosecutors said she “fabricated the existence of these shareholders”.Then, prosecutors said, Hunsicker used this money as new capital for the company while hiding CaaStle’s financial situation. Federal authorities allege that Hunsicker continued engaging in fraudulent behavior “even after law enforcement agents seized her electronic devices in March 2025”.CaaStle went bankrupt after the company revealed in spring 2025 that Hunsicker had significantly exaggerated the company’s finances, according to the New York Times. The company reportedly began as a web-based clothing rental company for plus-sized women and ultimately started selling its platform to outside fashion companies.