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FBI Reportedly Investigating Fyre Festival For Fraud

"This festival is on fyre."
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"This festival is on fyre."

And the dumpster fyre continues. The now-infamous Fyre Festival for models, rich people, and aspiring rich people has been the subject of a whole slew of lawsuits after spectacularly imploding last month, and now the FBI is said to be involved.

The NY Times reports that the Southern District of New York and the F.B.I. have launched a federal investigation into Fyre Festival, possibly for mail, wire and securities fraud. In addition to screwing over ticket buyers and investors, employees say they haven't been paid (in fact, there's audio of 25-year-old festival founder Billy McFarland confirming they're "not able to proceed with payroll immediately"); organizers owe the Bahamian authorities over $300K; rented equipment hasn't been returned; and restaurant owners, event planners and other workers involved in setting up the doomed event say they've been stiffed.

McFarland has reportedly had a history of sketchy entrepreneurship. The Times recounts his "membership club for upwardly mobile millennials" that some members claim failed to deliver on its flashy networking promises. Employees of Fyre Media, which he founded, described the company's payroll system as "ad hoc at best," with some wages getting paid out in cash.

Investors say they think some assets Fyre Media claimed it owned were fake, including the very island (which was supposedly once owned by drug lord Pablo Escobar) where the festival was initially supposed to happen. Though the festival advertised $400K accommodations for upper tier attendees, employees say their bosses actually made up those accommodations just to see if anyone would pay. Of course, pay they did.

McFarland took out millions of dollars in loans, and while company credit cards were getting declined on orders for the festival, McFarland told attendees to put $1,500 on digital wristbands "Fyre Bands" before arriving in the Bahamas—he claimed this was because the event would be "cashless and cardless," but the money allegedly went to cover some of those loans. McFarland also claimed Comcast was investing in Fyre Media, but that was false. Equipment orders reportedly came in late because of low funds, and employees and production crew members say they stopped getting paid. And though McFarland claimed they'd make back their money in ticket sales and other revenue, because the festival was so underprepared, both festival weekends were ultimately canceled at the last possible minute.

An attorney for Ja Rule told the Times he "would never participate in anything fraudulent; it’s simply not in his DNA." McFarland, meanwhile, said in a statement: "I cannot emphasize enough how sorry I am that we fell short of our goal I’m committed to, and working actively to, find a way to make this right, not just for investors but for those who planned to attend."

Though the "nightmare" that unfolded on social media in the wake of the Fyre Fest disaster sparked some schadenfreude for the models and rich folks who were inconvenienced, the reality is more than just funny pictures of a crappy "culinary experience." For instance, a Miami-based company that rented out furniture to the festival hasn't had it returned, and they say they're out about $10 million as a result, and might have to close up shop if they don't get their gear back soon. And Ian Nicholson, a carpenter who worked on Fyre Festival, says he's still owed $5K and has had his utilities shut off because he can't pay the bills. “It’s killing me,” he told the Times. Nicholson has three children. It's not just the Fyre Fest attendees who got screwed here.

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