The promoter of the failed Fyre Festival, who admitted ripping off attendees and investors in a scheme worth millions of dollars, has been arrested again over a new alleged scam.
Billy McFarland was rearrested Tuesday and charged with earning $100,000 by selling fake tickets to fashion, music and sporting events through his firm NYC VIP Access.
The 26-year-old began running the new ticket scheme at the end of last year – just a few months after his arrest in June 2017 for the disastrous Fyre Festival, according to prosecutors. He even allegedly targeted the same distraught festival goers he’d ripped off in the Fyre Media scheme.
Billy McFarland, who admitted ripping off attendees and investors in a scheme worth millions of dollars, has been arrested again over a new scam
Billy McFarland is seen leaving Federal Court after pleading guilty conducting a scheme defraud individuals and misrepresentation in Manhattan on March 6, 2018
Prosecutors said over 15 victims had been bilked since late last year of more than $100,000 as McFarland and his workers sold non-existent tickets to the 2018 Met Gala, Burning Man 2018, Coachella 2018, the 2018 Grammy Awards, Super Bowl LII and a Cleveland Cavaliers game that would include a team dinner with Lebron James.
‘Mr. McFarland is a serial fraudster plain and simple,’ prosecutor Kristy Greenberg told the judge this week.
The festival, which cost between $1,200 and $250,000 to attend, hit the headlines last year after McFarland’s highly anticipated festival for wealthy millennials, Instagram influencers and celebs was cancelled on the first day.
Attendees also shared photos of horrific conditions at the campsite, which many compared to a refugee camp, which was overrun wild wild dogs, trash, and had few toilets or fresh water. Despite shelling out thousands of dollars, many were left stranded and when they demanded their money back, were met with excused.
He was arrested in 2017 and pleaded guilty to the Fyre Festival fraud in March this year.
Even the food was a disappointment as this pathetic cheese sandwich goes to show
Now investigators say that while he was on pretrial release, McFarland targeted festival attendees in a new scam, to get them to buy tickets to exclusive events including the 2018 Met Gala. Those tickets never existed, prosecutors said.
The court heard that McFarland even used a spreadsheet identifying the richest Fyre Festival attendees so he knew who to target.
On Tuesday, McFarland was charged with one count of wire fraud and one count of money laundering. He faces a maximum of 40 years in prison if convicted.
McFarland denies the new charges.
McFarland previously pleaded guilty to wire fraud charges connected with the Festival in March in a deal that called for him to serve between eight and 10 years in prison, although he has requested leniency with no incarceration.
The plea pertained to the bungled spring 2017 Fyre Festival on the Bahamian island of Exuma that cost over 80 investors a total of $26 million.
Rapper Ja Rule and McFarland are pictured together far right. They were hit with a number of lawsuits amid claims they duped hundreds by failing to deliver on the hyped event
His latest venture was backed by a host of A-list models with packages costing thousands. Models (left to right) Elsa Hosk, Emily Ratajkowski, Bella Hadid, Lais Ribeiro, Gizele Oliveira and Rose Bertram were invited to the island in December ‘to give feedback’ on the festival launch
These are photos from the Disastrous Fyre Festival in Bahamas is a major Fail and canceled as guests paid thousands for a trashy unfinished site and canceled performances
The Bahamian festival was founded in part by rapper Ja Rule and as a way to build the digital app, Fyre music. The app allowed individuals organizing commercial events, such as concerts, to bid for artist and celebrity bookings at such events.
McFarland promoted the upscale’, star-studded event promising shows by artists like Blink-182 and the hip hop act Migos.
Famous names like Emily Ratajkowski and Bella Hadid were paid to promote the event on social media.
But the festival was anything but the ultra-luxurious event promoted as ‘the cultural experience of the decade’ and touted on social media by Kendall Jenner, Bella Hadid, Emily Ratajkowski and other models and celebrities.
The ‘upscale’ accommodations consisted of half-built tents, cheese sandwiches and rat droppings covering the ground.
Joon H. Kim, the acting US attorney for the Southern District of New York, and William F. Sweeney Jr., assistant director-in-charge of the New York Field Office of the FBI, released a statement following McFarland’s arrest last year.
‘William McFarland promised a ‘life changing’ music festival but in actuality delivered a disaster.
McFarland, organizer of the Fyre Festival, exits the U.S. Federal Court in Manhattan following his presentment on wire fraud charges in New York City on July 1, 2017
‘McFarland allegedly presented fake documents to induce investors to put over a million dollars into his company and the fiasco called the Fyre Festival,’ Kim said.
‘Thanks to the investigative efforts of the FBI, McFarland will now have to answer for his crimes.’
McFarland is set to appear in court later this month for his sentencing for the festival fraud scheme.
On Tuesday, his lawyer Randall Jackson, argued that McFarland should be allowed bail until his next hearing because he had proven he was no risk to flee by surrendering when he learned FBI agents were looking for him.
He also said one of McFarland’s colleagues, cooperating with prosecutors, was framing him.
‘We vigorously contest what is in this complaint,’ he told U.S. Magistrate Judge Gabriel W. Gorenstein in Manhattan.
Gorenstein, noting that McFarland would likely face an additional two years or so in prison if he is convicted in the new case, said that if he is freed on bail in the Fyre Festival case, he’ll face a $1 million bail on the new charges.
McFarland was arrested on the charges in June 2017 after altering a brokerage agreement saying he owned stock worth $2.5million
The judge ordered him detained after prosecutors said they also have evidence McFarland may have committed bank fraud and identity theft while on bail.
Assistant U.S. Attorney Kristy Greenberg called McFarland a financial threat to the community, saying he’d used the client list of the Fyre Festival to pitch a new ticket fraud that promised tickets to music, fashion and sporting events that he didn’t possess and had no way of getting.
Greenberg said McFarland was living lavishly with monthlong stays in luxury hotels and excursions to expensive restaurants. And he’d told his workers that he would flee if he is sentenced to over three years in prison next week, she said.
‘The weight of the evidence here is quite strong,’ Greenberg said. ‘He targeted the same victims who tried to attend his Fyre Festival.’
Jackson said his client has been cooperative with the government and was ready to answer any questions.
McFarland appears to be quite the entrepreneur. He launched his first startup at the age of 13, offering a service matching websites and designers.
Aaron Davis, a fellow classmate at the Pingry School, where high school tuition clocks in at $38,273 a year, painted the picture of a wealthy and enterprising young man who was constantly drawing up new business ideas.
McFarland launched his first startup at the age of 13. He founded Magnises, a members club with the promise of glitzy perks
Speaking to Death and Taxes Magazine, Davis said McFarland would ask friends at the school to invest in his ventures, before they would ‘twist his arm’ for any kind of payout.
Davis added: ‘He always kind of toed that line of whether it was a scheme or legitimate.’
While McFarland was a popular high school student, Davis said: ‘When he talked to you, it kind of felt like he was trying to sell you something even if he wasn’t.’
McFarland went on to attend Bucknell University in Lewisburg, Pennsylvania, only to drop out during his first year to launch Spling, a content-sharing website that raised $400,000 in funding.
He later went on to start Magnises, a members club with the promise of glitzy perks like a driver, yacht parties, and a West Village townhouse (the landlord later sued McFarland claiming he damaged the space).
In a 2014 interview with the New York Post, McFarland said Magnises was ‘Latin for absolutely nothing,’ adding: ‘The name is made up, but it sounds grand, doesn’t it?’
The black metal membership card, meant to signal status and exclusivity, acted as a credit card, even though it simply transferred the data from a pre-existing card onto its magnetic strip.
The company later transitioned to a concierge app that helped book reservations to restaurants of the moment or tickets to highly sought-after events.
Three years after Magnises launched, members began demanding refunds, claiming the service didn’t follow through on its promises.
A former member who spoke to Business Insider on the condition of anonymity used to app to purchase tickets to Beyonce and Adele concerts, along with the sold-out Broadway hit Hamilton.
Just before each event, a representative would issue an apology explaining the tickets were no longer available, the former member said.
‘According to accounts from several Magnises members, the startup will often try to placate those affected by cancellations by offering them tickets to future events,’ the unflattering Business Insider profile read.
McFarland seems to be taking the same strategy with the botched Fyre Festival, promising guests with VIP tickets to next year’s event.
Another member of Magnises, Elise Omaits, complained she was charged $250 to renew her annual membership five months before it expired.
When she filed a claim with the Better Business Bureau, she didn’t receive a refund until a month later. The company said there was a glitch with its payment system.