A Silicon Valley bombshell has dropped as the Department of Justice launches a criminal investigation into Deel, a fast-rising AI-powered HR tech company valued at $17 billion, over allegations of a corporate espionage plot targeting its competitor, Rippling.
Federal prosecutors from the Northern District of California are now pursuing the case as a potential criminal offense, marking a dramatic escalation in what had previously appeared to be a business dispute. The probe centers on claims that Deel CEO Alex Bouaziz personally orchestrated a covert spying operation inside Rippling—recruiting an insider to extract sensitive corporate data.
According to a sworn affidavit, Keith O’Brien, a Rippling employee based in Ireland, claims Bouaziz, along with his father (Deel’s executive chairman) and other executives, gave explicit instructions to access and deliver confidential information. Court filings now unsealed allege a shady payment scheme in which $6,000 was funneled through a bank account linked to the wife of Deel’s COO, Dan Westgarth, and then passed to O’Brien within seconds—raising red flags about concealment.
While Deel has denied any wrongdoing and claims ignorance of a criminal investigation, the grand jury subpoenas issued suggest otherwise. The company insists it will cooperate fully if contacted.
Despite the controversy, Deel’s momentum hasn’t slowed. A $5 billion jump in valuation following an October funding round shows investor confidence remains high—at least for now. Venture capital titan Andreessen Horowitz, a major backer of Deel, holds a stake reportedly worth $3.5 billion.
But with the DOJ now involved and the potential for charges related to trade secret theft and espionage, Deel’s planned IPO could face turbulence. If proven, the implications for the company—and its leadership—could be severe.
