The founder and former chief executive of a San Francisco startup has been arrested and charged in federal court with wire fraud for allegedly bilking an investor of $210,000, prosecutors announced today.

Jonathan Mills, 30, of San Francisco, founder of Motionloft, was arrested by the FBI on Wednesday and currently remains in custody, said U.S. Attorney Melinda Haag.

Mills, who is known as Jon Mills, was charged with one count of wire fraud in a federal criminal complaint that was issued under seal on Feb. 7 and unsealed after an initial appearance before a federal magistrate in San Francisco today.

He is due to return to the court of U.S. Magistrate Maria-Elena James on Friday for identification of a defense lawyer and a possible hearing on whether he should be granted bail while awaiting trial, according to Haag spokeswoman Lili Arauzhaase.

Mills’ former company, Motionloft, uses sensors to gather data on movements of pedestrians and vehicles.

He founded the company in 2010 and served as chief executive officer until he was removed from that post by a vote of the company’s shareholders on Dec. 1, 2013, according to an affidavit filed with the complaint by FBI Agent Brian Weber.

The affidavit alleges that Mills defrauded a doctor identified by the initials J.D. of $210,000 for an investment that was supposed to be for shares equal to 3 percent of the equity of Motionloft.

Weber alleged in the affidavit that Mills falsely told the investor that Motionloft was about to be acquired by Cisco Systems Inc. of San Jose for $760 million and that the investment would give him a share of the supposedly huge profits from the buyout.

The FBI agent said the investor never received any shares or funds and said representatives of Cisco and of Motionloft’s largest investor told the agent no acquisition of Motionloft was ever planned.

The complaint concerns only one alleged victim, but Haag said authorities believe there were several additional fraud victims. Anyone with information about Mills is urged to call the FBI at (415) 553-7400.

The wire fraud count is based on an online transfer of $10,000 J.D. allegedly made on Nov. 27, 2013, to a bank account held by Mills’ girlfriend.

If Mills is convicted, the maximum penalty for that count is 20 years in prison.

Julia Cheever, Bay City News

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