Josh Wander, the co-founder of 777 Partners, the investment company, which launched an unsuccessful bid to buy Everton, has been charged with a $500m fraud scheme.
The FBI unsealed an indictment charging Wander, with conspiracy to commit wire fraud, wire fraud, conspiracy to commit securities fraud, and securities fraud.
Former CFO of 777 Partners, Damien Alfalla, has already pleaded guilty in connection with his participation and is now cooperating with the US government.
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“Joshua Wander and Damien Alfalla, the cofounder and CFO respectively of the 777 Partners investment firm, allegedly stole more than $500 million from his company’s lenders and investors through fabricated lies of success and doctored financial records,” said FBI Assistant Director in Charge Christopher G. Raia.
“The defendants’ alleged deceit targeted the wallets of his trusting stakeholders to obfuscate the failing fiscal ventures of the business. With our law enforcement and prosecutorial partners, the FBI maintains its steadfast determination to disrupt any fraudulent scheme seeking to exploit victims before they’re left with millions in losses.”
U.S. Attorney Jay Clayton added:
“As alleged, Wander used his investment firm, 777 Partners, to cheat private lenders and investors out of hundreds of millions of dollars by pledging assets that his firm did not own, falsifying bank statements, and making other material misrepresentations about 777’s financial condition.
“When financial firms lie to their lenders, they do not merely breach contracts. They undermine the integrity and stability of our credit markets and our financial system more broadly. America’s financial markets are a source of strength and the envy of the world. The women and men of the SDNY and our law enforcement partners will continue to work tirelessly to protect our investors and our markets. We would also like to thank the U.S. Securities and Exchange Commission, which separately initiated civil proceedings against the defendants today.”
A deal for 777 to acquired Everton fell through in 2024. The club was later bought by the Friedkin Group.
READ MORE – The end in sight? Friedkin Group announces Everton takeover agreement
According to the indictment, which was unsealed in a Manhattan federal court, Wander, along with Alfalla and others, “lied to 777 Partners’ lenders and investors to fraudulently obtain nearly $500 million.”
It said that beginning in 2018, Wander started investing capital “into new sectors with less certain cash-flow profiles, including streaming platforms, airlines, and professional sports teams such as Sevilla FC and Genoa CFC.”
This spending caused 777 Partners to “face significant cash and collateral shortfalls. Wander sought to conceal those shortfalls and maintain access to funds by pledging more than $350 million in assets as collateral to certain lenders, knowing that 777 Partners either did not own the collateral or had already pledged the collateral to other lenders. Wander also directed employees of 777 Partners to digitally alter bank account statements to reflects millions of dollars in cash on hand that the firm did not have.”
Wander, 44, of Miami, Florida, is charged with one count of conspiracy to commit wire fraud, one count of wire fraud, and one count of securities fraud, each of which carries a maximum sentence of 20 years in prison. Wander is also charged with one count of conspiracy to commit securities fraud, which carries a maximum sentence of five years in prison.
Alfalla, 59, of Pelham, New York, is charged with one count of conspiracy to commit wire fraud, one count of wire fraud, and one count of securities fraud, each of which carries a maximum sentence of 20 years in prison. Alfalla is also charged with one count of conspiracy to commit securities fraud, which carries a maximum sentence of five years in prison.
Through his lawyer, Jordan Estes, Wander has denied all charges. He told Bloomberg – “This is a business dispute dressed up as a criminal case. We look forward to setting the record straight.”
