Founder of dis­as­trous Fyre Fes­ti­val ar­rested, charged with fraud

The Washington Post Sunday - - POLITICS & THE NATION - BY AMY B. WANG­

One of the or­ga­niz­ers of the dis­as­trous Fyre Fes­ti­val has been ar­rested and charged with wire fraud, ac­cord­ing to the U.S. At­tor­ney’s Of­fice for the South­ern Dis­trict of New York.

Billy McFar­land was ar­rested Fri­day in New York and ac­cused of mak­ing “false rep­re­sen­ta­tions to in­vestors” in his com­pany, Fyre Me­dia LLC, and in a “lux­ury” mu­sic fes­ti­val that had been set to take place in the Ba­hamas over two week­ends in April and May.

Act­ing Man­hat­tan U.S. At­tor­ney Joon Kim said in a state­ment Fri­day that McFar­land al­legedly pre­sented fake doc­u­ments to in­duce in­vestors to put over $1 mil­lion into his com­pany.

“Wil­liam McFar­land promised a ‘life chang­ing’ mu­sic fes­ti­val but in ac­tu­al­ity de­liv­ered a dis­as­ter,” Kim said. “Thanks to the in­ves­tiga­tive ef­forts of the FBI, McFar­land will now have to an­swer for his crimes.”

McFar­land, 25, ap­peared Satur­day be­fore a judge and was re­leased from jail on a $300,000 bond, ac­cord­ing to Va­ri­ety.

McFar­land had pro­moted the Fyre Fes­ti­val as “More than just a mu­sic fes­ti­val,” promis­ing not only live mu­sic, but also lux­u­ri­ous ac­com­mo­da­tions, gourmet meals and the op­por­tu­nity to min­gle with celebri­ties on a pri­vate is­land in the Ba­hamas. In ex­change, at­ten­dees paid from $450 to $250,000.

Ex­pec­ta­tions were high. In­stead, the fes­ti­val col­lapsed in spec­tac­u­lar, public fash­ion.

When at­ten­dees ar­rived in the Ex­u­mas, a group of is­lands be­long­ing to the Ba­hamas, they dis­cov­ered that the lux­ury ac­com­mo­da­tions were ac­tu­ally dis­as­ter­re­lief tents on the beach, some still not set up. Cheese sand­wiches made up the “gourmet meals,” and or­ga­niz­ers seemed to be equally in the dark, some­times lit­er­ally, about what was sup­posed to hap­pen. Blink-182, one of the head­lin­ers, pulled out at the last minute.

In April, McFar­land and his Fyre Fes­ti­val co-founder, the rap­per Ja Rule, had de­fended their in­ten­tions amid ac­cu­sa­tions that they had set out to de­fraud peo­ple.

Ac­cord­ing to the U.S. at­tor­ney’s of­fice, one way McFar­land did so was by ar­ti­fi­cially in­flat­ing his com­pany’s rev­enue and in­come, telling in­vestors that Fyre Me­dia had earned “mil­lions of dol­lars of rev­enue” from “thou­sands of artist book­ings” be­tween July 2016 and April 2017.

“In re­al­ity, dur­ing that ap­prox­i­mate time pe­riod, Fyre Me­dia earned less than $60,000 in rev­enue from ap­prox­i­mately 60 artist book­ings,” the of­fice added.

The com­plaint al­leges that, with at least one in­vestor, McFar­land backed up his claims to vast sums of money with a doc­tored bro­ker­age state­ment that made it ap­pear he owned shares of a stock worth more than $2.5 mil­lion.

In re­al­ity, the shares he owned in that stock were val­ued at less than $1,500, the com­plaint states.

“McFar­land truly put on a show, mis­rep­re­sent­ing the fi­nan­cial sta­tus of his busi­nesses in or­der to rake in lu­cra­tive in­vest­ment deals,” Wil­liam F. Sweeney Jr., as­sis­tant di­rec­tor-in-charge of the FBI’s New York Field Of­fice, said in a state­ment. “In the end, the very public fail­ure of the Fyre Fes­ti­val sig­naled that some­thing just wasn’t right.”

Wire fraud car­ries a max­i­mum sen­tence of 20 years in prison.

Rep­re­sen­ta­tives for Fyre Me­dia re­ferred ques­tions to an at­tor­ney, Stacey Rich­man, who did not re­spond to an email re­quest for com­ment Satur­day.


Billy McFar­land, right, leaves fed­eral court with his at­tor­ney, Sab­rina Shroff, af­ter his ar­raign­ment on July 1 in New York. He is charged with schem­ing to de­fraud in­vestors in his com­pany, Fyre Me­dia, and had promised to hold a “lux­ury” mu­si­cal fes­ti­val.

Newspapers in English

Newspapers from USA

© PressReader. All rights reserved.