Keith Berman, 67, the CEO of Decision Diagnostics Inc. (DECN), a California-based medical device company, was indicted by a federal grand jury in connection with an alleged scheme to defraud investors by making false and misleading statements about the purported development of a new COVID-19 test, leading to millions of dollars in investor losses. The indictment alleges that, from February through December 2020, Berman engaged in a scheme to defraud investors by falsely claiming DECN had developed a 15-second test to detect COVID-19 in a finger prick sample of blood. In truth, Berman knew his test was merely an idea and not a validated method of accurately detecting COVID-19, much less an actual product ready for manufacture and sale. According to the indictment, Berman and DECN were in precarious financial condition in the lead up to the pandemic, and Berman wrote in internal emails that he needed a “new story” to “raise millions.” The indictment further alleges that Berman falsely told investors that the Food and Drug Administration (FDA) was on the verge of approving DECN’s request for emergency use authorization of its new COVID-19 test. In truth, Berman knew that the company lacked the financial resources and insurance necessary to conduct the clinical testing required by the FDA to complete the application process, but concealed these material facts from and misled investors.
