Venture capital investors gave Shiloh Luckey (fka Shiloh Johnson) more than $13 million for her tax compliance startup, ComplYant. Federal prosecutors now say she lied about the company’s revenue, customers, subscriptions and cash balances. She allegedly used some of the investors’ money to buy a house and a Tesla and pay for her wedding in Anguilla.

But there is one detail in the case that I can’t get past: Prosecutors say that Luckey told investors she was a licensed certified public accountant even though she wasn’t. This seems like something that should have been discovered before anyone handed her millions of dollars, no?

Luckey founded ComplYant App Inc. in 2019 and marketed it as an online tax compliance service for small businesses. According to the SEC, she presented herself to investors as a licensed CPA with extensive experience in tax management, supervision, and accounting compliance. That’s a pretty relevant credential when you’re asking people to invest millions in your tax compliance company.

The government says Luckey has never been a licensed CPA. Checking a CPA license is not difficult. Every state has a licensing agency, and CPA credentials can be independently verified. This should have been a basic part of a background check of Luckey when people were getting ready to invest with her. She allegedly raised $13.3 million from venture capital investors. These investors should have been sophisticated enough to know that due diligence was in order, and that should have included basic verification of credentials.

The background check might not have uncovered all the things that prosecutors know, but I think finding out that the founder of a tax compliance company wasn’t actually a CPA after she claimed to be one should have prompted a few more questions. What else has she said that isn’t true? Are the company’s financial numbers real? Do the customers exist? Is the cash really in the bank? Those would have been great questions to ask!

The SEC says Luckey told investors that ComplYant’s monthly revenue increased from about $2,500 in November 2020 to more than $250,000 by September 2022. Anyone doing due diligence should have been skeptical of this too. It’s certainly possible to grow the revenue 100 times in less than 2 years, but if I was investing, I’d want to know how it was done.

The SEC says the real numbers are very different. It is alleged that ComplYant never generated more than $510 in revenue in a single month during that period and averaged about $250 per month. Luckey allegedly told investors the company was adding dozens or even hundreds of paying subscribers each month when it was actually averaging fewer than four.

Prosecutors say Luckey used pitch decks, investor materials and company updates to inflate ComplYant’s revenue, customers, subscriptions and cash reserves. Investors kept putting money into the company. According to the criminal indictment, the victims eventually lost their entire investments when ComplYant ran out of money and shut down.

The allegations about Luckey’s house are especially interesting. Prosecutors say that in 2022 she wrote a $1.5 million check from a ComplYant bank account that didn’t have enough money to cover it, deposited the check into another ComplYant account at a different bank, and wired the money to purchase her home before the first bank figured out the check was bad. She allegedly covered the resulting negative balance with new money obtained from investors. The SEC also alleges that Luckey spent at least $2.2 million of investor funds for her personal benefit, including the house, Super Bowl tickets, and her destination wedding.

Luckey was arrested in September and has been charged with nine counts of securities fraud, three counts of wire fraud, one count of bank fraud and two counts of money laundering. There will undoubtedly be a lot of attention paid to the alleged fake revenue, the house, the wedding and the millions of dollars investors lost. I’m still stuck on the CPA license.

Investors can’t independently verify every representation a founder makes. But professional licenses are among the easiest things to check. When someone is asking you for millions of dollars and pointing to a professional credential as evidence that she has the expertise to run the company, maybe spend five minutes finding out whether she actually has it.

Had someone done that here, the answer would have raised a very important question long before ComplYant collapsed: What else should we verify?