The Securities and Exchange Commission has charged William Sarris and Joseph Endoso, two former executives of San Jose-based Linqto, Inc., with defrauding thousands of retail investors who bought pre-IPO stakes on the company’s online platform.
What happened
The complaint, filed October 9 in federal court in San Francisco, alleges a Linqto subsidiary sold over $430 million of special purpose vehicles between 2021 and 2024. The vehicles held interests in private companies billed as pre-IPO opportunities.
The SEC seeks injunctive relief, disgorgement with prejudgment interest, civil penalties, and officer and director bars against both men. The allegations have not been proven in court.
The four alleged deceptions
According to the complaint, Sarris and Endoso misled investors in four main ways.
- They indicated Linqto’s prices reflected current market conditions or below-market prices, when almost all offerings were actually priced higher than fair value.
- They described certain securities as “sold out” or “fully subscribed” while additional shares remained available for sale.
- They claimed an algorithm automatically set prices that would rise and fall with investor demand, when Linqto personnel continued to set prices manually.
- They told investors Linqto was compliant with federal securities laws after their own counsel said the business violated federal securities regulations.
Key facts in the case
| Item | Detail |
|---|---|
| Defendants | William Sarris and Joseph Endoso, former Linqto executives |
| Sales volume | Over $430 million in special purpose vehicles, 2021 to 2024 |
| Platform | Linqto online marketplace for pre-IPO company stakes |
| Court | N.D. Cal., case 26-cv-11675, filed October 9, 2026 |
| Charges | Securities Act Section 17(a); Exchange Act Section 10(b) and Rule 10b-5; Securities Act Sections 5(a) and 5(c); Investment Company Act Section 7(a) |
| Requested relief | Injunctions, disgorgement, civil penalties, officer and director bars |
The complaint also alleges the two men unlawfully operated unregistered investment companies and sold securities in unregistered transactions to unaccredited investors. Sarris faces an additional control person liability charge under Section 20(a) of the Exchange Act.
Why the pricing claims matter
Pre-IPO stakes trade privately, so retail investors have few ways to check a quoted price. The SEC alleges Linqto exploited that blind spot.
When a platform claims an algorithm sets prices, investors reasonably expect the process is mechanical and demand-driven. Allegations that personnel set prices manually, above fair value, turn that promise on its head. If proven, buyers systematically overpaid for stakes in companies that had not yet gone public.
What investors should watch
The SEC’s litigation will proceed in federal court in San Francisco. The agency credited its San Francisco Regional Office with the investigation and noted assistance from the U.S. Attorney’s Office for the Southern District of New York and the FBI.
Investors who bought special purpose vehicles through Linqto between 2021 and 2024 can monitor the docket and any later claims process. Buyers of private-market products should verify pricing methodology, fee layers, and resale restrictions in writing before committing capital.
A “sold out” label on a private platform is a marketing claim, not a market fact. The case is a civil action, and the defendants have not admitted liability.
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AlphaBetaStock provides news and analysis for investors. This article is not legal advice.
