Albert Saniger, the 35-year-old founder of fintech startup Nate, has been charged with fraud by the U.S. Department of Justice.
The company, launched in 2018, promised a “magic shopping app” that used AI to let users buy from any e-commerce site with a single tap.
But behind the sleek interface was a surprising reality: hundreds of Filipino workers in a Philippine call center were manually processing transactions, not cutting-edge AI.
Nate raised over $50 million from big-name investors like Coatue and Forerunner Ventures, including a $38 million Series A in 2021.
Saniger pitched the app as a game-changer, claiming it could handle purchases “without human intervention” except in rare cases. Prosecutors allege this was far from the truth.
The app’s automation rate was “effectively zero percent,” with Filipino “purchasing assistants” doing the heavy lifting—entering payment details, selecting sizes, and completing checkouts.
When a deadly tropical storm hit the Philippines in October 2021, Nate even set up a second call center in Romania to keep up with demand.
The DOJ’s Southern District of New York says Saniger misled investors and hid the app’s reliance on human labor, restricting automation data as a “trade secret” even from his own team.
The fallout? Saniger faces one count each of securities fraud and wire fraud, both carrying a maximum 20-year sentence. The U.S. Securities and Exchange Commission has also filed a parallel civil action.
This isn’t the first time a company has been called out for exaggerating AI capabilities.
In 2023, a drive-thru “AI” startup and an AI legal tech firm were similarly exposed for relying on human workers, often in the Philippines.
For Filipino workers, this case shines a light on their role in global tech, often powering services behind the scenes for low wages. For the tech world, it’s a reminder to look past the hype and ask what’s really under the hood.
