Lending Club's public markets debut put the fast-growing fintech industry on the map. Its founder's sudden and scandalous departure could wipe out much of the territory.

CEO and founder Renaud Laplanche, who started the online lender nine years ago, resigned last week after it was discovered that he had deceived buyers of Lending Club products, the company said early Monday morning.

An internal review had discovered that senior managers had fiddled with the terms of $22 million worth of loans that Lending Club sold to one institutional investor, the company said. "Certain personnel apparently were aware that the sale did not meet the investor's criteria," Lending Club said, without specifying Laplanche's exact role. Three senior managers involved with the sale also resigned.

"A violation of the company's business practices along with a lack of full disclosure during the review was unacceptable," Hans Morris, Lending Club's longtime investor and newly appointed executive chairman, said during a conference call Monday morning. "A key principle of the company is maintaining trust." 

The San Francisco company lends to individuals and small-business owners but relies on institutional investors (mostly hedge funds, banks, and wealth-management firms) to buy its loans. In this case, it appears that Laplanche--or his managers--wanted to sell loans that didn't meet his buyer's required criteria, and changed information about the loans in order to make them appear eligible for a sale.

"The loans in question failed to conform to the investor's express instructions as to a non-credit and non-pricing element," Lending Club said in its press release.

The company also indicated that Laplanche or one of the three other managers had been manipulating Lending Club's financial decisions for their own personal gain. The board's review uncovered "a failure to inform the board's risk committee of personal interests held in a third party fund while the company was contemplating an investment in the same fund," according to the press release.

Such revelations are obviously ominous for Lending Club, which had already faced mounting investor worries (and inexorably sliding share prices) over increased regulation and competition in its market. But the news also casts a big shadow over greater universe of financial technology startups hoping to transform financial services. 

Lending Club has been fintech's bellwether. Its much-heralded IPO in late 2014 conferred success and legitimacy upon the small, tech-savvy, nimble non-banks that seek to take on the slow, inefficient, and unloved megabanks.

But the promise of boundless fintech disruption has become much more tempered in recent months. By February, one high-profile investor was warning that "fintech would end in tears." Emotions aside, the young companies in this industry are at least facing mounting regulatory interest while growth slows. 

Last week, Lending Club precursor and competitor Prosper said it would cut 28 percent of its staff, due to declines in loan volume. (Prosper and Lending Club have both been members of the Inc. 500 list of the fastest-growing U.S. private companies.)

These would be challenges enough for any industry. But Laplanche's resignation gives ammunition to any skeptic--including the professional ones at government regulatory agencies eying these nonbank startups.

The Lending Club founder has been a leading voice for fintech, arguing to Inc. (among others) that his company will make finance at large more transparent and more consumer-friendly. "We went public to build a brand, show transparency, and make a statement about Lending Club being here to stay," he told me in January.

His resignation makes that goal much harder -- for both his company and for his industry.