FatBurger's $47 Million Fraud Explained
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- Опубліковано 2 чер 2024
- In this video we go over the recently alleged fraud case against Fat Brands and its former CEO Andrew Wiederhorn.
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0:00 - 1:07 Intro
1:08 - 3:51 Wilshire Financial Services
3:52 - 11:46 Fat Brands
11:47 Motivation - Фільми й анімація
It's insane that a $150 million dollar fraud only had ~$2 million fine.
2nd gilded age baby, corruption pays in this new era
He stole from working class people. You only get really punished if you steal from the wealthy. Hence the more severe punishment for Sam Bankman Fried.
bruh
keep on keeping on
See how it works now?
Motivation? - Greed. Imagine having millions of dollars in the bank, a cushy job as a CEO, a mansion, and thinking "I bet I could rip off my own company for 47 million dollars." Some people have no end to their greed.
You give them a finger and they take the whole hand.
This guy's actual business is corporate swindling.
Him: "Imma gonna do it again, look at how small the penalty is!"
@@dappodan1dappodan12EVERY SINGLE TIME ✡️✡️✡️😎👍
Interestingly the franchise holder in Singapore (Deelish Brands) has similar story 🤪
@@RichardKing-sx6xc There's definitely *some* amount of correlation.
Agree. There’s an entire class that monetizes everything they touch & focuses on inflating perceived value for short term financial transaction profits that push the debt to the company. Then when it collapses they wonder what happened.
How can you ruin so many lives and only get 14 months prison. I know of someone who got 5 years for £1 million tax evasion
Ruined lifes? Dude, this idiot was ripping off pennys from tens of thousands of people at a time. That's how stock fraud works in the end
Because stealing moneywhen you're rich is frowned upon but not that bad , stealing from uncle Sam is unforgivable in the eyes of our government
@@mariopot789I think the judges use the intelligence, audacity, and guts to do it as mitigating factors. The only difference between them and ordinary thieves is household thieves don’t require much brain power. 🤯
He got a public defender, a real lawyer would get him off with a few month in jail or time serve.
That's America. If you are rich you are pretty much above the law.
But you must not hurt rich ppl. That's a big no no. Poor ppl are only there so rich ppl can get richer, after all. Hurting them doesn't matter.
Never invest in a public company where the majority of shares is held by one shareholder or a group of 'related parties'.
That would include Microsoft, Amazon, Tesla, Berkshire Hathaway
Agreed. Anything above 10% is a red flag for various reasons. Could be the founders, activist shareholders, an attempted hostile takeover, and on and on. I would investigate further those larger owners since they have be disclosed in public filings.
Many companies are owned by some firm, family, or individual. It’s not a bad thing. It’s just that you should know who you are giving your money.
You shouldn’t give your money to a prior criminal like they did with FatBurger.
@@COL_ChrisAll these are 'widely held'. BH is 35% family owned. All others below 13%. Minority shareholders.
That's horrible advice, majority of the top 10 successful business are majority owned by their founders.
As a very young child I would sit on the stool at the original Fat Burger around the corner from my house in Los Angeles on Western Ave, and watch the lady who started Fat Burger make the burgers. When my mother would send me to get her a burger, often one of the older man would sit me up on one of the tall stools at the counter. She was a nice lady. She use to say to me, how to make a good burger. Today Fat Burger is no where near what it was when she was making the food.
It's still better than their competitors, at least in my area. I think Fatburger could be saved if it was extracted from the Wiederhorns and run by someone with a back to basics mentality. No more cash mining, just run it like a normal restaurant chain and put the profits back into the business.
I used to go to the one in Westwood back in the 1980s.
grew up in LA where we have ALL the great burger chains worldwide that started HERE. In n out, Tommy's world famous chili burgers, McDonald's (the original concept location in San Bernadino), the Habit (Santa Barbara) ...and Fatburger has always been my favorite burger hands down
@@jettrink5810 For certain. Fatburger was so much better when the lady who started was making them. I remember how she made them.
@@Kevin_Street I agree. Its about only money for them. This is why so many companies are terrible now. Too many owners only care about how rich they can get. Not how good they can make their product
Aren't convicted felons barred from being officers of public companies? How did he just walk out of prison in Oregon and then into Fatburger in Los Angeles?
I don't know for sure, but his holding company, Fogcutter, got delisted from the NASDAQ for keeping him on. Maybe he used it as a shell , since he was technically in charge of it and not Fat Brands?
Coin, connections, clout, crews, computer code, control, corrupt cronies, and shady opportunities. Same as people like Chump, Aleggz Jonez, Bankman-Fraud, Bernie Madeoff, etc.
‘Murica
@@Novastar.SaberCombat Noticed a nice political bent to your shpiel there
@@Novastar.SaberCombatCaucasian
Thank you for the regularly scheduled corporate fraud breakdown, keep up the good work ^-^
Wiederhorn should never have been allowed to be CEO of a public co.
It's not a crime to make loans that default
@@thewhitefalcon8539 Senior directors at publicly traded companies have a fiduciary duty to be transparent about funds and use company's resources to the best of their ability for shareholders. Every quarter they have to sign off to that effect, so yes is the crime of fraud.
@@thewhitefalcon8539 the FBI and SEC do not share that sentiment
@@frevazz3364 When did a banker go to jail just for losing money?
@@thewhitefalcon8539 i cant believe I have to explain those to you, giving yourself loans you do not intend to pay is fraud and tax evasion
Fun fact: FatBurger was once owned and managed by Magic Johnson of the LA Lakers. I still have a craving for one every now and then. The secret was the relish they used on their burgers.
Almost anytime you hear the phrase “inter-company loans” you better run because it’s just a house of cards waiting to fall
Too bad scumbags like these can't be banned from being CEO's or owning/running businesses when they have already proven they will destroy people's livelihoods to get rich.
Banned from being a CEO lol...
I mean, it makes sense.. if someone repeatedly commit financial crimes, I think he should be banned from getting into the world of business and finance until he sorts himself out.
And that usually happens via years of rehab and education of basic ethics, so at least hopefully he's ready to re-enter society at that point.
That's their job. They did it successfully.
@@syahmiirfan6779 you sound like a commie
Of course you get banned from any exec position in any public company.
14 months is nothing for this guy. He probably laughed it off plus he got a 2 million bonus while in prison. Hope he rots in prison. PURE GREED
He will not rot and live a really nice life unlike majority of US residents
A lot of people would happily trade 14 months in prison and 2 mils in restitution for 100M+ in fraud money taking in. Even a kid knows that math.
@@timop6340 We have one of the highest standards of living. Even the homeless people earn more than the average wage in Russia lol
wonder how many other CEOs are currently out there operating like this...
All of them.
That was my reaction too - and this is exactly why trump thought his behavior was perfectly fine - "everybody is doing that" is what people tell themselves as they make their criminal decisions & a lot of the time they are correct. The only reason some get accused & go to jail & not all the others is simply because there are not enough FBI & legal people to take on all the suspects !
@@veronicaroach3667or fbi used by the biden regime to attack his political enemies.
The hubris of such an obvious fraud. He wrote in the disclosure doc that he never expected to repay the “loan”! Sad times that this got as far along as it did before finally hitting the FBI radar.
When you get away with stuff for a long time, you start to think you'll never be caught.
Nothing gets done until very rich people start losing money, then it’s suddenly priority number one
I have waited YEARS for this video.
Why is that? Did you have suspicions?
@@rontayanfabturger
I've might have spent too much time around Silicon Valley tech bros, but when I saw it was Millions and not Billions, I was like, ah, that's not so bad 🤣
We in the corporate fraud Fandom are truly spoiled
Billion is the new million.
And million is the new thousand.
@@andybaldmanPersonally excited for the first trillion dollar fraud. Still a decade or two out at the earliest.
@@andybaldman After taxes and fees, $1 million barely buys groceries for a year.
Shut up
Imagine stealing nearly $50 million and not reporting any of it on your taxes. Yeah that won't eventually be noticed. Good lord
Enjoyed your video (as usual). I'm a Brit living in London. I had no idea that getting your son married to the daughter of a 'Real Housewife of LA' represents success and makes you part of the LA elite.
well, it does and it doesn't. they were only part of the elite in the sense that they were rich, and the media has tricked a lot of people into idolizing the rich for no other reason than that they have money. marrying the daughter of a real housewife makes you 'trashy rich' though
No, to most reasonable people here it validates White Trash status.
haha I know right
shallow thresholds, very shallow!
🤣🤣🤣
They are the reason why a large Round Table pizza is $35
Fake cheese with sugar sauce on cardboard with nitrate-infused "meat". 🤮 It's literally unbelievable.
It’s fucking good tho
Dude I just got a $30 XL pizza last night 🫣😂 it was delicous
Or you could understand basic economics where the more currency printed, the higher prices go😒
They were that much 5 years ago before Covid.
I drove a fat burger regional manager around one day in my cab as he went from one restaurant to another. I ate one and thought I was going to die. It was like a shot of lard to my heart
Dude really 😂
@@nokites Early 1990's. I was driving a cab while going to college.
sounds delicious
"I ate one and thought I was going to die. It was like a shot of lard to my heart" -> I think they would consider that as a compliment and a good review. The brand looks like a Heart attack grill going mainstream
Lard is healthy
The reason he took the risk to issue loans instead of distributing them as dividends is because dividends are considered a form of taxable income, whereas loans on the other hand are not, this means that you could receive a loan of a billion dollars and not pay a single cent in taxes because technically you have not received any income
that's why you off shore your "kash" and then it gets "loaned" back to you, with your house as collateral. No one can touch your house. Not even an ex mistress or wife or investor.
Getting a huge loan that is "forgiven" should be a big red flag. No real business operates this way.
I have a Fatburger nearby. Decent, nothing special burger. VERY expensive. Service ALWAYS screws up. One time ordered double burger, had rcpt, single burger showed up after a LONG wait. Another time, when I was in a hurry, they gave my food to someone else and just forgot about me. I don't go there no more.
My Grandmother worked at MAC for about 40 years. She checked in guests. She knew everyone. Including the founders of Nike. She didn’t talk much about who she knew specifically. But I remember in 1992 she asked me if I knew who Michael Jordan was? She told me he spoke to her very kindly everyday while the Dream team practiced daily. I laughed and said of course. I imagine she knew this gentleman also.
I took care of Andy's grandmother, and I knew him when he was 17 years old. Worked for his father in laws restaurant, knew his wife and everything about him. His grandmother would not be happy regarding his actions.
I’m calling BS on your story. Jordan is a notorious scumbag in the restaurant industry.
@@reneemoreno8030yeah he is a real scumbag. My sister knew him in Portland and way back he was legit but the greed brought out who he really is. A scumbag. Reminds me of a scumbag ex president. Scumbag.
I was wondering why FatBurger seemingly disappeared from the Seattle market. They were fairly popular out here for a while. I wonder if the company was demanding too much money from franchisees as part of this scheme.
In so many franchise operations the franchisor gets rich and the franchisee does not do that well. Read the stories about 7-11 and Subway.
@@jamesodell3064 Indeed, some restaurants would later close and re-open without the franchise, with their own menus inspired by the franchise. They're usually not as consistent nor as satisfying, but they have a large weight off their shoulders.
There were two Fatburger restaurants not too far away from me, both have closed. I wondered why they closed, I figured both were in poor locations. The burgers were good but I've had better.
@@jamesodell3064 Subway was the worst one I can think of. Far too many of their stores around, there are five within one mile of me; there were 16 in town but three of them closed between 2015 and the pandemic. I stopped going to them after the last corporate 'rebrand' changed the quality of ingredients and taste of the sandwiches, and raised the prices. I can get better at local delis for the same price.
@@jamesodell3064 and even McDonalds. Read the extortion in the franchise contract and the requirements that can have HO move in and steal the store BACK from you , and stick you hard. You get nothing. Even my buddy in the eighties sold his grocery store and bought a govt. Petro-Canada station franchise, and the oil company STOLE it ou t from underneath him. Met him as a labourer on a job site, and wondered WTF such a great guy/great worker was even doing there, and he told me.
He wanted loans because you aren’t taxed on the loan. He would’ve been taxed on the distributions had he chosen to go that route, reducing his ability to spend on luxury cars, private airfare, and extravagant homes by 40%.
No income tax on loans.
True. Maybe he hooked up with Robert Kyiosaki who proudly promotes this knowledge.
Never heard of FatBurger.
@@snookerman
fo
They are mostly in CA.
"Over 150 locations worldwide" is a pretty big business but nothing compared to the giants like Mcdonalds and Wendy's
Good, cause it's meh.
Not shocked. Video says they have 150 locations world wide. For comparison McDonald's has over 250 in New York City alone
Board was getting paid that's how.
How was he allowed to head up any company after prison?
I was in prison with Andrew, we were in halfway house together. He gave me rides to work in 1 of 2 $100k+ Benz. I was in for weed....
The most American brand that has ever America’d around the world. Were fat and we weed proud
What?
...and we're greedy, crazy af, and corrupt lol
Ice cube once complained about eating fat burger while Eazi E and his manager where eating lobsters
Fog Cutter Capital? More like Turd Cutter Capital!😂
Thank for this video. Charles Ponzi would be proud.
Brilliant. Well researched. Thank you.
Bro thought Arrested Development was a documentary kek
Once a conman.................ALWAYS a conman..........until their last dying breath.
TRUMP?
Johnny Rockets is gross. Worst burger I ever had.
And overpriced...
Yes! I remember when they opened in my city. I was pissed that I paid that much for a crappy burger.
Fog Cutter Capital=Smoke Screen Capital.
😂😂😂😂
Foggy Capital
Non-existent lighthouse.
Ooh man, tgat mention of Fazolis... I miss them.
Great documentary. Thanks
CEO (controlling stake) hires board.
CEO hires auditor.
A diabolically unique and brilliant strategy.
Do you know how these people get away with stuff like this? Because rich people, and large businesses are 99% never audited....how do I know? I worked for the collections department at the IRS. The people who get audited are 90% in the middle class income. So the very poor and the very rich get off scott free.
The poor have no money to take and the rich have too many lawyers. The middle class are easy pickings for the IRS vultures.
So, you used to work there, or are you still working at the IRS?
Same thing here in my country. It's just waaaaay easier and cheaper to chase the low income and middle class. Yes they have less money but there are SO many of them and they can't hide shit becuase they don't have shell corps and dozens of accountants. I'm sure most countries would exclusively tax the upper middle to lower class if they could, they are kinda already doing that actually.
That's universally true. Same with traffic citations, small business licensing fees, property tax assessments, social security premiums, and everything else. The middle class gets hit hard because they are easy targets.
Waiting to see him on American Greed.
Excellent video, as usual.
Last time I ate at a Fat Burger was 98 when there was one near my work place. The food was food and the workers were friendly. On the walls were a lot of funny quotes. There is one that I passed by this week that I wanted to stop by and check out and that is how this video caught my eye. Feel bad for anyone affected by the scams.
as much as i hate your shady sponsors, you always cover interesting stuff and dont waste any time getting to the point
Remember when you could get a double cheese with fries for $2.95????? Ahhh the good old days.
The entire company was only worth $100 million? And then it dropped to $70 million? That seems pretty paltry for a company with thousands of restaurants.
4:22 even the dog is like "mannnn what am I doing here with this crook"
How many other ceo are doing this right now?
I've been waiting for the next fraud. I never would have guessed fast food, though.
Youre not paying attention every year then 😂
I got bad legal advice. My lawyers told me that I would get away with it.
I used to eat at the original restaurant, near Wilshire Blvd on the West Hollywood border, decades ago. Now, I live in Portland, Oregon. Go figure ...
Fatburger on Sunset was awesome
If you are not in the financial market space right now, you are making a huge mistake. I understand that it could be due to ignorance, but if you want to make your money work for you... prevent inflation
Thanks for continuing updates I'd rather trade the crypto market as it's more profitable. I make a good amount of money per week even though I barely trade myself.
A lot of people still make massive profit from the crypto market, all you really need is a relevant information and some ‹professional advice. ‹it's totally inappropriate for investors to hang on while suffering from dip during significant
You trade also?, I
No I don't trade on my own anymore, I always required help and assistance
From my personal financial advisor
When I was in middle school I completed the Triple King Challenge at Fatburger. They put your pic on the wall and gave you a shirt
Your parents must have been so proud!! Look at our boy!!
Minor correction: the MAC is mostly an athletic club… 30k members. It’s really nice, but by no means for the ultra wealthy.
why wasn't the son charged as a co-conspirator?
But, what is massive fraud your honour?
I'm a middle aged guy who loves hamburgers and eats out every day. However, I almost never eat at FatBurger. Why? Their hamburger meat is the absolute worst quality of any brand I've encountered, full of gristle and cartilage. I have no idea how they're still in business.
Wait, soon you can make a conman musk story
Fatburger was better when it was owned by the original founding family. It became too "corporate".
Another Great Video !!!
They really need to do something about this guy. He keeps scamming upwards stealing more money from more people with larger companies. If nothing is done what will happen next? Will he start a medical company like Theranos and siphon billions from investors? Or maybe start a tech company like Apple and siphon a cool trillion dollars from gullible investors.
@6:02 That private jet has propellers. Don't worry, the 1970's Wonder Woman tv show made the same mistake in their title sequence every episode. I love your content.
Those are turboprop engines.
Too bad all the brands they own are crappy and serve low quality food
Round Table Pizza was pretty good, too bad their prices went through the roof (the fraud is probably why).
Some people never learn from their mistakes. Despicable.
A guy who got his start as a collections dbag winds up to be a conman fraudster. Never would have expected that.
I don’t understand why you’ve got the goose laying golden eggs and you decide to kill it with fraud. Sell it.
Greed is a disease.
Greed
Suffered a stroke before going to prison… so he couldn’t go. Oh ok.
It blows my mind how OVER AND OVER AGAIN, these “smart” people are smart enough to get themselves in REALLY WELL paying positions….. but will do the ABSOLUTE DUMBEST SH!T….. and think they won’t get caught.. 🤷🏻♂️ I guess it’s the perfect combination of Ego and greed.
It is so surprising that when you slap a wealthy person on the wrist that they just embezzle more. 🙄
Fatcat owning fatburger... checks out
all of us are tempted when an opportunity comes, ethics are not valued generally sadly, we gotta watch out if our EGO is out of control
yeah, unfortunately. the ego is important in our lives, but we should always keep it under control.
never heard of them
+150 stores makes them a big regional chain.
Fatburger food has always been somewhat expensive. Andrew Wiederhorn's shenanigans may very well have driven prices higher. In order to appreciate FATBURGER you need to order Fat Fries and get them piping hot. Fatburger has 1.0 lb burgers, 1.5 lb burgers and bigger still. I used to have the 1.0 lb burger with no salt and no 1000 Island dressing. Fatburger beef patties taste like ground beef, not the composite patties like Burger King, Jack In The Box, Carl's Jr. and for many years, McDonald's.
The older Fatburgers had jukeboxes which played classic jazz and R&B music on CD's. I remember one automatically playing a very artsy 29-minute jazz piece by JOHN COLTRANE. Another patron asked me why the saxophone solo never seemed to end! This happened over 20 years ago.
Can you do a video covering solar companies, bunch of them have been popping up lately where I live here in Puerto Rico and the contracts they offer seem like a scam.
Solar panels are a scam.i got 3 quotes and none were reasonable.
Hi
Hi
Hi
hola
omg hey
I'm such a cynic I thought this was bait for a scam thread. Glad I was wrong.
i swear you people are bots
The people who comment?
Unfortunately, I am human
We are the robots
Kraftwerk
@@jazztheglass6139 Wir sind die Roboterrrrrrrrr!
@@Jager6S the people tho repeat the exact same comment as someone before them.
Rob a bank of 20k - 15 years prison. Embezzle millions and put people out of work….2 years and a teeeeenie fine.
When you realize the fine for fraud is never the entire amount stolen you just accept that a small jail sentence is the cost of doing business
He just spent too much. The loan wasn’t a bad idea if used to capitalize on real estate or even divest into the SPY and other investments. He seemed to be doing it smart until that decision.
Smart? Dumb af. According to the vid he had 80% control, instead of doin low key exit he decided to steal money from company, leaving paper trail behind. How is that smart?
And what did he stole it for, not to invest but to spend it on bs. How is that smart?
Severe brainrot.
predatory practices should be exposed in a democratic society
That and the loan amount comparitive to income of the Fat Holding company. Oh, and not actually making loan/interest payments. Whatever investments he would do would have had to cover the 10% interest after all. But yes, instead of delaying gratification and just attempting to run the company well...then eventually selling it to another restaurant group....he and his family's ego obviously required that everyone believed they were super rich.
@@sd_pjwal according to vid they already had IPO so all the idiot had to do was to cash out
They just don't give these clowns long enough prison terms. Listening Donald?
Crooked Joe Biden bed pay attention
14 months in jail for ruining lives and still gets paid a CEO's salary. You Americans are wild
Great video
FIRST!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
Nobody comments “first” with more enthusiasm than the second commenter on a video.
I love your 2006ish name.
@@Rob-ou1py Can't change it :(
I was using this name for things before that game came out, though
Good video
Remember these practices when companies claim poverty,related party transaction are a favoured tool for deception.
I wonder if this is why my local Fatburger is "closed for fire repairs and renovations" lol.
As my parents used to tell us, "liars are thieves and thieves are liars."
Was it seen on the ballance sheet?
Only heard of it in the movie 'very bad things'
There used to be a Fatburger at the Pearl Harbor Submarine Base across the street from the gym
Damn! I mean seriously, damn! Really? Twice? The guy does it once, GOES TO PRISON, gets a 2 mil bailout for the "fine," then does it AGAIN? All by starting as a debt collector. As a FatBurger customer in the days before Wiederhorn it's been a mystery as to why the chain kept struggling. Expanded so fast, then closed so many, etc.,
If I was a thief, I would not be robbing banks, stores, houses, etc... Pay off is too little for the amount of prison time. Instead, I would do what Andrew Wiederhorn did, or even scam people like Logan Paul where the pay off is big with little to no prison time.
I remember seeing several locations of Fatburger around my area about 20 years ago. I occasionally ate there and enjoyed it. Then they all disappeared, good to know what actually happened.
Average civilian gets out of prison: Criminal record makes it difficult, to this day, to get a respectable job
Scumbag CEO gets out of prison: Time to make the bacon!
Fatburger sounds like a parody of America in a Japanese anime