Dozens of Boeing 737 Max planes are wrapped up in a purported wire fraud scheme, with the FBI accusing a Miami-based investor of fraudulently obtaining millions of dollars to pay for the aircraft.

Joshua Wander, co-founder of the investment firm 777 Partners, is widely known for his investments in European soccer teams, streaming platforms and aviation. His firm, which does not own any 777s or have any connection to Boeing's 777, invested in low-cost carriers Flair Airlines in Canada and Bonza Airlines in Australia, and signed deals with Boeing to purchase up to 134 Max planes between 2021 and 2022.

Wander’s headline-grabbing spending spree quickly showed signs of cracking when, in 2023, some of Flair’s airplanes were repossessed following allegations of missed payments.

In October, federal prosecutors indicted Wander in New York on wire and securities fraud charges, accusing the businessman and his associates of lying to 777 Partners’ investors and lenders to fraudulently obtain more than $500 million, according to recently unsealed court records.

The Securities and Exchange Commission filed a separate civil suit against Wander, his business partners and their company this month.

“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,” U.S. Attorney Jay Clayton said in a statement.

Jordan Estes, an attorney with Gibson Dunn representing Wander, said in a statement, “this is a business dispute dressed up as a criminal case. We look forward to setting the record straight.”

Federal prosecutors accused Wander of directing employees to alter financial records, including using Microsoft Paint to manipulate financial statements.

The SEC accused Wander and 777 Partners of fraudulently soliciting investors to participate in a preferred equity offering, raising $237 million and then transferring some of those funds to personal bank accounts for Wander and his co-partner Stephen Pasko.

According to court records, Wander fraudulently obtained $40 million in 2021 to pay for 777 Partners’ expenses, including the purchase of 24 737 Max 8 planes.

Wander purchased the planes in March 2021 and owed Boeing about $10 million. But, around the same time, 777 Partners’ profits dipped, due to rising interest rates and increased competition in its primary markets.

Wander’s employees warned him at the time the company did not have sufficient funding to cover “new ventures,” according to court records.

To obtain more funding, Wander falsely claimed to one of 777 Partners’ lenders that the company had assets it did not actually own, artificially increasing its borrowing base. Wander then used those fraudulently obtained funds to pay for the Boeing aircraft, according to court records.

Wander did the same to another lender the same month, “to further finance the Boeing aircraft acquisition,” the documents read. In October 2021, he impermissibly used funds to cover millions of dollars of expenses associated with Flair Airlines.

By November, 777 Partners’ Chief Financial Officer Damien Alfalla texted his business partners to express concern about the company’s financial situation. 777 Partners needed to raise more than $300 million and he didn’t see a way to do so, Alfalla said in text messages included in the SEC’s lawsuit.

“It is going to be difficult for me to continue working here if at year-end the situation does not dramatically improve,” Alfalla wrote. “Today alone we need several millions that we don’t have.”

Alfalla pointed the finger back to 777 Partners’ aircraft and airline purchases, writing “liabilities are growing at an astronomical pace due to our aviation sector not providing sufficient cash to cover its obligations.”

Alfalla pleaded guilty to an unspecified charge for his involvement in the fraud scheme in October, according to the FBI.

Boeing declined to comment on the lawsuits.

777 Partners placed five orders for Boeing planes between March 2021 and July 2022, including one that Boeing celebrated with a signing ceremony at the Farnborough Air Show in 2022.

Its order book had the option to purchase up to 134 737 Maxes, according to Boeing news releases, but only 38 of those turned into firm orders, according to Boeing’s website tracking deliveries.

Boeing delivered most of those 38 planes in 2021 and 2022, before 777 Partners stopped taking deliveries in the fall of 2022. The investment firm later resumed accepting deliveries and took possession of its final six Max planes in 2023.

It's not clear what happened to all those delivered planes. Bonza Airlines went bankrupt last year, abruptly grounding its fleet and leaving passengers stranded. Flair Airlines is still operating and is locked in legal battles with the aircraft lessors that repossessed its planes.

777 Partners went bankrupt in October 2024, and still owes its lenders hundreds of millions of dollars, according to the FBI.

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