Fyre Festival founder and confessed scammer Billy McFarland has been charged with new criminal counts of wire fraud and money laundering as part of an alleged scheme to sell fake tickets to Fyre Festival attendees.
Vice was the first outlet to link McFarland to NYC VIP Access, a ticketing company that generated more than $100,000 in sales for hard-to-get tickets to events like the 2018 Met Gala and Burning Man, but was essentially a scam allegedly operated by McFarland as he awaited sentencing on June 21 after pleading guilty to stealing $26 million from investors to fund the disastrous Fyre Festival.
Assistant U.S. Attorney Kristy Greenberg alleges McFarland attempted to conceal his ownership of NYC VIP Access by moving proceeds from the alleged scam to different accounts controlled by his employees. On Tuesday, McFarland was arrested and brought before a magistrate judge, where he was ordered to be jailed until June 26. United States District Judge Naomi Reice Buchwald, who is overseeing the Fyre Fest case, now must decide whether to revoke McFarland’s bail as he awaits sentencing or release him after June 26 under stricter house arrest rules.
According to a 19-page indictment unsealed yesterday (June 12), McFarland began selling tickets through NYC VIP Access in late 2017, months after he had been arrested for his involvement in the Fyre Fest disaster that left hundreds of fans stranded on the island of Grand Exuma.
According to FBI Agent Brandon Rice, McFarland used the customer database from Fyre Fest and his defunct credit card company Magnises to market tickets for events like the Met Gala and Taylor Swift’s Reputation tour, although authorities say he never actually owned the tickets he was selling. McFarland allegedly used fake names, email addresses belonging to employees and multiple bank accounts to hide his crimes, according to the indictment, and at one point, allegedly created a holding company called BZM Projects — his initials are BZM — to conceal his involvement in NYC VIP Access.
The indictment says at least three unnamed individuals unknowingly assisted McFarland with the scheme, using a script written by McFarland to cold call prospective clients and attempt to sell tickets for events like Burning Man, Coachella, the Grammys and the Super Bowl. At one point, McFarland was trying to sell tickets to a Cleveland Cavaliers game that allegedly included dinner with star LeBron James.
McFarland tried to conceal his involvement by using a bank account set up in his employee’s name and had his assistant create a spreadsheet of Fyre Festival attendees organized by which individuals had the highest salaries, the indictment reads. In total, McFarland generated at “least approximately $100,000” from the sale of “fraudulent tickets” to at least 15 “customer-victims.” McFarland allegedly generated $36,000 selling fake tickets to the Met Gala and its accompanying red carpet event and $1,300 selling fake Burning Man tickets. According to the indictment, after spending $700 for two Grammys tickets, one victim flew in from Florida for New York event, only to be rejected at the door.
The indictment said McFarland would often use his employee’s email accounts to communicate with customers, and would often meet with his employees at restaurants or shared work spaces. FBI officials said they were able to allegedly tie McFarland to the scheme through an IP address that belonged to Billy’s dad Steven McFarland at his house in Morristown, New Jersey.
At one point McFarland even asked an employee if he could secretly use their bank account to cover McFarland’s living expenses. The employee agreed “as long as McFarland deposited sufficient funds to cover his expenses,” the indictment alleges. McFarland allegedly funneled $138,000 through the account and rang up large personal charges including a $7,000 hotel bill and payments to buy domain names like bzmprojects.com and bzmbookings.com, as well as a talent booking website called vybewithme.com.
McFarland was set to be sentenced June 21 on two counts of fraud tied to the Fyre Fest case, but in light of the new criminal charges, the U.S. Attorney’s office is asking for an extension, writing “the Government wishes to provide to the Probation Officer information pertaining to the defendant’s obstruction in making false statements,” as he was awaiting sentencing. The letter also warns that McFarland could face additional counts for “criminal conduct that has not yet been charged.” In a filing last week, McFarland’s attorneys asked the judge to sentence McFarland to six months house arrest for his involvement in Fyre Fest, while prosecutors had been seeking a four to eight-year sentence.
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