Investing in foreign soccer clubs is an increasingly well-worn page in the entrepreneur playbook. Movie star turned business mogul Ryan Reynolds made the move trendy with his 2021 acquisition of the Welsh team Wrexham AFC, but he’s far from the only businessperson to see the beloved sports institutions as a worthwhile investment.
Earlier this year, for instance, Inc. spoke with the husband-and-wife co-founders of the staffing company Belay and the Inc. 5000-charting beer company NoFo Brew Co—and they, too, had taken stakes in European soccer clubs.
But if you’re turning to pro soccer as a place to park your money (or build your personal brand), make sure you don’t get the investor equivalent of a red card pulled on you. That’s one lesson from the story of Josh Wander, an American businessman who, according to multiple reports and a statement by the Federal Bureau of Investigation, is now being charged with fraud by U.S. prosecutors.
Wander co-founded 777 Partners, an investment firm that owned or held stakes in multiple different soccer teams in Australia, Brazil and across Europe, the New York Times reports—but the firm collapsed, and Wander now stands accused of fabricating financial documents and misleading lenders and investors in an effort to defraud them of nearly half a billion dollars.
Miami-based 777 was once “one of the biggest accumulators of European soccer clubs,” the Times reports, but a lender accused it of fraudulent behavior last year and the firm subsequently saw its British business go bankrupt and American business enter limited receivership.
Starting in 2018, the FBI says in its statement, Wander began investing money from 777’s primary line of business—in which it underwrote and financed structured settlements related to lawsuits or personal injury claims—into other, less reliable sectors, “including streaming platforms, airlines, and professional sports teams such as Sevilla FC and Genoa CFC.”
“Despite warnings from employees … and contrary to the terms of the credit facilities, Wander directed that restricted funds from 777 Partners’ lenders be used to cover the firm’s acquisitions and expenses,” the FBI continues. That spending led the investment firm to face “significant cash and collateral shortfalls,” which Wander allegedly tried to conceal “by pledging more than $350 million in assets as collateral to certain lenders, knowing that 777 Partners either did not own the collateral or had already pledged the collateral to other lenders.”
Wander is also accused of telling 777 employees to alter bank statements to reflect “millions of dollars in cash on hand that the firm did not have.”
Wander’s lawyer called the charges “a business dispute dressed up as a criminal case” in an email to the Times, adding: “We look forward to setting the record straight.”
Brian Contreras
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