In early 2018, SoftBank, the world’s biggest investor in tech startups, directed accounting firm PricewaterhouseCoopers to assess a construction startup in which it had just led an $865 million investment. The three-year-old startup, Katerra, was led by a former CEO of Tesla and had hired other experienced Silicon Valley executives and engineers to revolutionize the construction industry by using factories to build modular apartments quickly.

After the audit report was completed, Joanne Solomon, then Katerra’s chief financial officer, emailed it to some colleagues. “I haven’t read yet. Pretty much afraid,” she said in an email, according to a lawsuit the now-bankrupt company recently filed against her and other former executives and board directors.

The PwC report detailed, in part, what was obvious to some Katerra executives and employees at the time: The startup’s biggest customer, as well as two other firms Katerra had acquired, were owned entirely or in part by its own co-founders and executives, presenting glaring conflicts of interest. The recent lawsuit alleged that Katerra’s former principals as well as directors from Soros Fund Management, Greenoaks Capital and manufacturing giant Foxconn breached their fiduciary duties through “self-dealing and self-interested transactions” and by failing to “enforce meaningful controls” to rein in spending. The suit also alleged that executives misused company funds for private jet flights and professional basketball tickets.