The founder of an artificial intelligence startup who promised to improve school attendance with an AI chatbot was arrested Tuesday and charged with fraud.
Joanna Smith-Griffin, 33, was detained in North Carolina on two fraud charges out of Manhattan Federal Court.
Smith-Griffin was the founder of AllHere Education, a company that promoted its own AI-powered chatbot called “Ed.” Smith-Griffin and AllHere said the chatbot would help improve school attendance by notifying parents if their child wasn’t in school.
The chatbot was also pitched as a companion for students, who would help them with academic problems and engage them in “conversation.”
The second-largest school district in the country, Los Angeles Unified, signed a $6 million contract with AllHere to bring “Ed” to schools.
But Smith-Griffin told investors she was working with other major districts — including New York City Public Schools — that had no contracts with AllHere, according to federal investigators. She also misrepresented the company’s financials, claiming $3.7 million in revenue in 2020 when AllHere actually generated just $11,000, the feds said.
Duped investors gave Smith-Griffin about $10 million, some of which she spent on a down payment for a home in Raleigh, N.C., and on her wedding, the Justice Department said.
Once touted on the Forbes 30 Under 30 list in 2021, Smith-Griffin was forced out of AllHere in June 2024 as the company collapsed and filed for Chapter 7 bankruptcy. She now faces up to 40 years in prison.
