Billy McFarland, Fyre Media, Inc., Magnises, Inc. Grant Margolin and Daniel Simon Charged by SEC – Goodman & Nekvasil P.A. May Recover Investor Losses
Securities and Exchange Commission Charges Billy McFarland, Fyre Media, Inc., Magnises, Inc. Grant Margolin and Daniel Simon
The Securities and Exchange Commission announced that New York entrepreneur William Z. (Billy) McFarland, two companies he founded, a former senior executive, and a former contractor agreed to settle charges arising out of an extensive, multi-year offering fraud that raised at least $27.4 million from over 100 investors.
The SEC’s complaint alleges that McFarland fraudulently induced investments into his companies Fyre Media, Inc., Fyre Festival LLC, and Magnises, Inc., including in connection with McFarland’s failed venture to host a “once-in-a-lifetime” music festival in the Bahamas. The SEC complaint alleges that with substantial assistance from Grant H. Margolin, his Chief Marketing Officer, and Daniel Simon, an independent contractor to his companies, McFarland induced investors to entrust him with tens of millions of dollars by fraudulently inflating key operational, financial metrics and successes of his companies, as well as his own personal success – including by giving investors a doctored brokerage account statement purporting to show personal stock holdings of over $2.5 million when, in reality, the account held shares worth under $1,500. According to the complaint, Billy McFarland used investor funds to bankroll a lavish lifestyle including living in a Manhattan penthouse apartment, partying with celebrities, and traveling by private plane and chauffeured luxury cars.
According to the complaint, from at least 2013 through 2017, McFarland—both directly and through Fyre Media and Magnises—fraudulently induced over 100 investors to invest more than $27.4 million in Fyre Media and Magnises, as well as in a third business founded by McFarland, Fyre Festival, LLC (“Fyre Festival”). According to the complaint, McFarland engaged in a host of deceptive and fraudulent acts in furtherance of the offering scheme, including: (i) making material misrepresentations and omissions to investors about the financial strength of each of the three companies; (ii) creating documents that fraudulently inflated key financial metrics, including revenue and income, at each of the three companies; (iii) altering a stock ownership statement to falsely suggest the existence of collateral for securitized investments in Fyre Festival; (iv) manufacturing a purported (but nonexistent) $35 to 40 million sale of Magnises to (among other purported buyers) a third party that did not exist; (v) falsely informing investors and potential investors that he would obtain event cancellation insurance for the Fyre Festival, and (vi) touting “exclusive,”—but, in fact, nonexistent— relationships with artists and talent. According to the complaint, McFarland provided falsified income statements and similar falsified financial documents to investors, who relied on them in making their investment decisions.
According to the complaint, McFarland’s offering fraud and materially false and misleading statements and omissions were purposefully designed to make Fyre Media, Fyre Festival, and Magnises appear more successful and financially strong than they actually were, to tout McFarland’s management expertise and oversight of Fyre Media, Fyre Festival, and Magnises, and to induce investors to invest tens of millions of dollars into McFarland’s companies.
Investors in Fyre Media, Inc., Fyre Festival and/or Magnises, Inc. May Recover their Losses with Goodman & Nekvasil, P.A.
If you purchased your Fyre Media, Inc., Fyre Festival and/or Magnises, Inc. investment from a licensed financial advisor, Goodman & Nekvasil, P.A. can help you. Goodman & Nekvasil, P.A., a Clearwater, Florida, law firm with a national practice representing victimized investors, has filed hundreds of cases against brokerage firms selling high-risk or fraudulent investments such as Fyre Media, Inc., Fyre Festival and/or Magnises, Inc. and has recovered more than $180 million dollars on behalf of victimized investors.
All our cases are handled on a purely contingency fee basis by Kalju Nekvasil, Esq., formerly regional counsel with the NASD, now known as FINRA. Kalju Nekvasil, Esq. has practiced in this area of the law for more than 35 years.
There is no charge for an evaluation of your case. Further, we handle our cases on a contingency fee basis. This means that unless we recover money for you, we charge no attorney’s fee. Unless you recover any money, you pay us nothing, not even the costs and expenses which the firm will advance on your behalf. Finally, the filing of such a case should not affect your ownership of your Fyre Media, Inc., Fyre Festival and/or Magnises, Inc. investment.
If you incurred losses on your investment in Fyre Media, Inc., Fyre Festival and/or Magnises, Inc. and would like your case evaluated by a securities attorney (again, there is no charge for an evaluation and all cases are handled on a purely contingency fee basis), please contact us.
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