Exclusive: RadiumOne’s very strange story just got stranger
Turns out RadiumOne's fired CEO isn't the only employee with a spotty record, according to the US Secret Service.
If the aim of the game in Silicon Valley is getting noticed, RadiumOne definitely stands out.
But not just for its technology.
The San Francisco-based provider of digital ad-buying tech was pushed into the spotlight last month after founder and CEO Gurbaksh Chahal got fired following his conviction for misdemeanor domestic violence and battery.
Chahal isn't the first high-level executive to engage in behavior that reflects poorly on a company, and he likely won't be the last. But CNET has learned that there's an even weirder story concerning another employee who worked at 5-year-old RadiumOne until February: Brad Smith, the company's ex-director of engineering. Described by a former employer and hackathon organizers as a kind of geek wunderkind, Smith was allegedly living and working under a fake identity and since 2008 had been on the lam from the US Secret Service for identify theft, among other things.
Few people, including work colleagues at RadiumOne, knew about Smith's secret life -- until now.
Before the board fired Chahal for battering his girlfriend, RadiumOne wasn't well-known to those outside of tech circles. The mobile advertising startup, which raised $33.5 million from well-known venture capital funds including Trinity Ventures and Crosslink Capital, created software that automates the process of media buying for digital marketers. Customers include Condé Nast Britain and professional cycling team Omega Pharma-Quick Step. It has 200 employees.
Chahal's transgressions are now part of the public record given that the ousted CEO put up a widely cited, albeit tone-deaf defense of his actions. In a since-deleted blog post on April 27 that he titled "Can You Handle the Truth?," Chahal acknowledged having lost his temper at his girlfriend. That wasn't the final word. One former RadiumOne executive, ex-Vice President of Marketing Doug Chavez, subsequently challenged Chahal on Twitter, leading to a nasty back-and-forth between the two, with each claiming the other was unfit to work with.
Smith's history as a wanted man with previous felony convictions and who did prison time for hacking isn't as widely known.
To be sure, this isn't the first time a tech company hired someone with a dubious or altogether fake background. In 2012, Yahoo fired CEO Scott Thompson for padding his resume with claims of an unearned computer science degree. Last year, enterprise social-media company Yammer reportedly discovered, after federal investigators showed up at its offices, that one of its contractors in San Francisco was working under a fake name while being sought for child molestation in Georgia. And in 2000, then-Lotus CEO Jeff Papows resigned after it was discovered he lied about being a captain and fighter pilot in the US Marines, about his educational background, and even about having a black belt in tae-kwon-do.
That each person was able to situate himself in a top spot at a high-profile Silicon Valley company raises questions about hiring practices and the due diligence that you assume accompanies the hiring of new employees. That question may be especially relevant in the case of acqui-hires -- when a company brings on a team of employees as part of an acquisition -- which is how Smith arrived at RadiumOne.
When a company brings on a team through a buyout, it may not do the kind of intense scrutiny it might do when making an individual hire. That's especially true in the fast-paced world of Silicon Valley tech, say recruiting specialists. "The selectivity and rigor with which they select people is not found when they acquire a company," said Stephen Kane, a Hillsborough, Calif., specialist in human resources. "That's the problem."
And it may become an even bigger problem if the company is planning to go public, as RadiumOne may be preparing to do.
"The individual in question, then operating under the name of Brad Smith, became an employee of RadiumOne following the acquisition of a company, [Focal Labs], in 2011," RadiumOne said in a statement. "The company takes its hiring obligations seriously.
"Normal background checks were conducted on these newly acquired employees but as the individual in question had given a false name and Social Security number, the checks revealed nothing improper in his background. The day RadiumOne discovered that Brad Smith was operating under a false identity, the company terminated his employment."
Smith was unavailable for comment.
Wanted by the Secret Service
It may not be common knowledge that law enforcement still issues wanted posters like the ones shown in post offices in old Westerns. But it does.
The online version of the poster featuring Bradley Raymond Anderson's name is topped with a red all-caps banner reading "WANTED BY THE U.S. SECRET SERVICE." It notes that Anderson is 5-foot-11, weighs 160 pounds, has hazel eyes, and was born on April 10, 1979. Or maybe May 10, 1977.
The government issued a federal warrant for his arrest on September 10, 2008. The grand jury's seven-count indictment charged Anderson with identity theft, using stolen credit card numbers, possessing machines for making credit cards, and attempting to steal a Social Security number. The list of property the government alleges Anderson stole along the way numbers 23 items. It includes a Nexus 40-inch flat-screen TV, a Nikon D50 digital camera, an HP Pavilion laptop computer, an "Apple Mac Book laptop, gray in color," and a KitchenAid mixer. And, oddly, $89 in cash.
According to Jon Dalton, a Secret Service special agent in Portland, Ore., the feds tracked Anderson to San Francisco earlier this year, where they discovered he was "living and working" under a false name. But he avoided capture and absconded to Portland in February, where he finally surrendered. A clerk in the federal district court said US Marshals arrested Anderson on February 20, 2014.
Gerri Badden, the public information officer for the US Attorney's office in Portland, confirmed that the US government considers Bradley Raymond Anderson and the Brad Smith who worked as director of engineering at RadiumOne to be "one and the same."
For the purposes of this story, we'll refer to Anderson, aka Smith, as "Smith."
The wanted poster shows two photos of Smith. In one, he's wearing an orange T-shirt, with his head tilted to the left. That same photo can be found in the Facebook account of RadiumOne employee Brad Smith -- which was opened in 2008, just 18 days after the federal warrant was issued. That photo also appears on the Crunchbase page for Focal Labs, a startup that Brad Smith co-founded with Fergus Hurley and Maxime Domain and sold to RadiumOne in 2011 for an undisclosed sum.
Some who have worked with Smith easily laud his talent. His help was "super valuable" in launching their product, said Steve Echtman, CEO of HearPlanet, a travel app maker Smith worked at from mid-2008 to mid-2009. "He was just overall a really good developer...He was a well-rounded engineer."
Smith was also the co-founder of PayWithBits, which it positioned as a "Square for Bitcoin." PayWithBits was featured in TechCrunch last year.
His work outside of RadiumOne peaked at the Consumer Electronics Show last January when Smith was part of a team that won the top prize in the AT&T Developer Summit Hackathon in Las Vegas.
"Until we were recently notified by law enforcement that this is the same person, we were unaware of any investigation into his activities," an AT&T spokesperson said.
On Facebook, on January 6, Smith crowed that he had "just won $25,000 in Vegas." The next day, he posted a photo of himself hoisting a huge $25,000 check over his head at an AT&T party headlined by rapper Macklemore.
Smith could not be reached for comment, but his attorney Stephen Sady, a federal public defender in Portland, offered this statement: "Brad has been living as a productive and pro-social member of the community for the past six years. We have every intention of working with the government to assure that any harms from the past are remedied, and [we] look forward to Brad continuing to provide his expertise and creativity in the tech community."
What is RadiumOne?
RadiumOne has its main offices in a tall building in the heart of downtown San Francisco -- just two blocks from CNET's headquarters. The company was founded in September 2009 by Chahal, who had already struck gold once when he sold a previous ad network, BlueLithium, to Yahoo for $300 million in 2007, and who won Ernst & Young's 2013 entrepreneur of the year award in the platform technology category. On its website, RadiumOne says it "builds intelligent software that automates media buying, making big data actionable for marketers and connects them to their next customer."
That's the kind of description guaranteed to induce yawns for those not deeply involved in ad networks. But for an enterprise company, making money is the way to the hearts of investors, and it's clear RadiumOne was attractive enough to venture capitalists to raise a $10.5 million A-round of funding in late 2009, and a $21 million B-round in March 2011 led by Crosslink Capital. That round valued the company at $200 million. Some think an IPO is in its near future.
"When we look at potential portfolio companies, we try to identify who has the technology and vision to really disrupt an industry and make a global impact," Jim McLean, a partner at Crosslink Capital, said in a RadiumOne release after the 2011 funding round.
One can imagine that the Chahal follies imperiled the company's chances at a lucrative IPO, perhaps forcing the board's hand more than any moral imperative. "I think the decision was made because the negative publicity [surrounding Chahal's conviction] was too much," said Tasso Roumeliotis, the founder and CEO of Location Labs, a mobile services company that develops safety and security services around device location management. "It would have hampered their ability to go public and it would have been a black stain."
Whether or not the company is a good place to work, it's clear there was some friction at the top levels. Chavez, the former vice president of marketing, left RadiumOne last year. In a tweet on April 27, the same day that Recode broke the news that the CEO had been fired, Chavez wrote, "I resigned because working with [Chahal] was insufferable." To which Chahal quickly responded, "More like you got terminated because you have no skills."
So this is happening: pic.twitter.com/lesv04c2eQ
-- Ben Parr (@benparr) April 28, 2014
Chavez declined to comment for this story. He posted his (rather cordial) resignation letter, dated April 23, 2013, on Twitter, writing to Chahal that "I believe it is time to hand the Marketing reins over to some fresh Marketing blood and new marketing perspective...I am tendering my resignation as VP of Marketing from RadiumOne. I'm happy to work with you and the team to ensure a smooth transition as I exit. We can discuss a mutually agreed upon last day."
On April 27, RadiumOne issued a press release announcing Chahal's firing, and his replacement by COO Bill Lonergan. "Bill has an extraordinary professional background and has helped build BlueLithium and RadiumOne into industry leading brands," the company said in its statement. "We are confident he will continue RadiumOne's impressive trajectory."
The release made no mention of Chahal's legal problems. Nor, of course, did it mention the company had somehow allowed a man wanted by the Secret Service to be hired, and promoted to a position as director of engineering.
No Ax Murderers
For a well-funded startup to miss the warning signs in the made-up background of someone like Brad Smith is puzzling. Smith's LinkedIn profile lists no educational background, and offers professional experience only dating to 2008 -- coincidentally the same year the Secret Service issued its arrest warrant for Bradley Raymond Anderson.
According to Kane, the Silicon Valley-based human resources specialist, well-run companies usually "go through extraordinary lengths to make sure that [a potential hire] not only is not an ax murderer, but also fits into their culture."
New hires at all companies are also required to fill out an I-9, a federal identification document that establishes whether someone is eligible to accept employment. Kane -- who was speaking generally, and not about the Smith case -- said that form should reveal whether someone is using a real Social Security number or one, say, "for somebody who died in 1963."
According to Location Labs' Roumeliotis, who has advised friends on M&A deals, "I will tell you it's sloppy sometimes. You have inexperienced CEOs, and there's competitive pressure. [Vetting teams during an acquisition] can be very sloppy from a deal perspective."
Once someone's onboard at a company, they would likely not have to go through much additional vetting as they are promoted up the org chart, Roumeliotis added. "I would say once you're in, you're in."
Exactly how Smith managed to evade the I-9 trap he no doubt encountered when he joined RadiumOne is unclear. His Secret Service Wanted poster may offer a clue. He is, it states, "proficient in manipulating and creating false identification documents."
Brad The App Guy
So which Brad is it? The Secret Service's Wanted poster says Bradley Raymond Anderson also uses Brad Smith or Brad Anderson as aliases. In anything tied to RadiumOne, or other technology work between 2008 and early 2014, he was known as Brad Smith.
It's not clear exactly when he left RadiumOne, but the company claimed him as an employee in January when he helped win the AT&T hackathon at CES with SafeNecklace, a "'leashless' wearable solution for tracking kids during outings."
On February 3, Smith checked in on Foursquare at RadiumOne headquarters in San Francisco.
By February 20, he was in federal custody.
On February 25, US Magistrate Judge Paul Papak released Smith, pending trial. Oregon doesn't require bail, so he didn't have to put up any money. But Papak issued a number of conditions for his release: He is not to touch controlled substances, he can't leave Oregon without authorization, and he must submit to a search of his person, his residence, or his car at any time.
Unsurprisingly, his "computer use is restricted to work use," and he is "not to possess or obtain any mail, financial or identification documents in any person's name other than [his] true identity."
Smith is due to appear in federal court for a three-day jury trial starting July 8. Despite years in a director-level job at a high-flying startup, he is being represented by Sady, a federal public defender known in Portland for battling the government and often winning the "reduction or dismissal of the most serious charges against his clients," according to The Oregonian.
Now, freed while he waits for trial, he appears to be looking for client work. At the top of his LinkedIn profile, where he calls himself an iOS developer and entrepreneur, he doesn't use a last name at all. There, next to a picture in which he wears a gray fedora and a black T-shirt festooned with app logos, he simply calls himself "Brad The App Guy."
CNET's Roger Cheng contributed to this story.
Update, 2:10 p.m. PT: Includes comment from RadiumOne.
Correction, 6:54 p.m. PT: The story originally misstated when Doug Chavez left RadiumOne.