Andy Wiederhorn, a former CEO of a Fatburger restaurant.
In the past days, Andy Wiederhorn and his company Fat Brands were charged with criminal conspiracy to defraud banks in pursuit of forty seven million dollars of false bank loans. The business operates Fatburger, Johnny Rockets, and Twin Peaks.
Fat Brands was criminally prosecuted together with Wiederhorn and others. The indictment accuses them of wire fraud, tax evasion and other crimes linked to their alleged activities.
Moreover, SEC filed another suit against the same companies as well as their executive officer named Wiederhorn demanding damages for securities laws violations.
In 1990s Wiederhorn had been convicted of similar charges in criminal case while later he faced a federal court indictment in Los Angeles for being an ex-convict who possessed firearms that he used to shoot people before surrendering himself into custody again.
According to accusations levelled by prosecutors at his trial on Thursday ,Wiederhorn directed his own finance manager’s 58 year old fat brands including himselve over this period through using company’s credit facilities which he never repaid.
Even so SEC is claiming that all these monies were spent on aircraft charter services such as business class tickets plus luxurious holidays whilst millions more went towards paying off mortgages and lease agreements hence the rest going into “shopping plus jewelry” amounting nearly $700K.
He resigned from his position as CEO in 2020 after federal regulators began investigating the firm. Wells notice received by Fat Brands earlier this year indicates that SEC has already informed it about plans to prosecute.
For instance, during 2017 through 2021 this fraud made up almost half(44%)of Fat Brands’ total income thus its bills always remained unpaid. In this case,Wiederhorne outwardly gave money back from his son Thayer who simultaneously was CMO under the age of nineteen years at that time currently held position COO with a company.
Fat Brands’ management failed to declare those cash transfers as transactions with related parties. In 2020, Fat Brands wrote off the aforementioned cash transfers after it merged with another company which was also owned by Wiederhorn’s Fog Cutter Capital Group and happened to be its biggest shareholder.
Also included in the SEC’s complaint are the firm’s vice-president of finance and former CFO Ron Roe along with his ex-CFO associate Rebecca Hersingger. Hezinger and William Ammon a tax adviser were named in the indictment too.
Additionaly, starting from 2006, Wiederhorn had owed personal income taxes to Internal Revenue Service (IRS). The indictment also claims that he did not include any proceeds originating from his “business” loans taken out through fats brands into his taxable revenues throughout all these years. By March 2021, Wiederhorn had accumulated $7.74m of unpaid personal taxes due to IRS.
Twenty years ago he pleaded guilty to falsely reporting his earnings on tax forms as well as paying bribes for associates under him when he ran Fog Cutter Capital where he paid a couple of million dollars fine before spending over one year incarcerated inside Oregon Federal Penitentiary; nevertheless while still being jailed the board of directors at Fog Cutter approved compensation package which included fines as well as salary package for him thereby causing uproar among public opinion en masse.
