“Cherokee undoubtedly checked out both the technology AND Rossi. “
Then the are aware that Rossi has a record of scams and fraud and went to prison for fraud?
What makes you think they don't??
They would no doubt be aware that he went to jail for tax evasion. Not necessarily fraud, at least per the Rossi wikipedia entry.
So they’re aware he has an obvious questionable character. Do you think that would make them look harder at his demo, or would they just blithely move forward with $20M because he has such a pleasing personality?