The U.S. Securities and Exchange Commission (SEC) has filed a civil enforcement action against Miami-based investment firm 777 Partners LLC, 600 Partners LLC, co-founder Joshua Wander, co-founder Steven Pasko, and Chief Financial Officer Damian Alfalla, alleging they ran a multi-year scheme to raise about $237 million from investors while concealing a severely overdrawn credit facility and diverting collateral. On the criminal side, federal prosecutors in New York have unsealed an indictment charging Wander and Alfalla with defrauding private lenders and investors out of more than $500 million.
What the SEC Says Happened
The SEC’s complaint alleges that from January 2021 through May 2024 the defendants sold a preferred-equity investment and told investors the issuers were profitable enough to pay a 10% annual dividend. Regulators say that was false; the issuers were in a worsening liquidity crisis and the main credit facility was overdrawn by roughly $300 million. The SEC also alleges funds and collateral tied to a life and annuity business were misused and that compliance reports were false.
Double-Pledging of Collateral
According to the federal civil filings, Wander caused annuities that were already serving as collateral for the credit facility to be pledged again to other lenders, in violation of the facility’s terms. By September 2021, the value of the double-pledged annuities exceeded $146.6 million, and additional double-pledging occurred afterward. That left multiple lenders under-secured.
How This Ties to Earlier 2024 Litigation
In 2024, London-based Leadenhall Capital Partners LLP filed a civil lawsuit in New York federal court accusing 777-related entities of the same thing , representing that collateral was “free and clear” when it was not, or when it had been pledged to more than one lender. The SEC’s 2025 case describes conduct that is consistent with those earlier allegations, which will likely strengthen the position of similarly situated investors and lenders.
Potential Claims
If these allegations are proven, they support civil claims under federal securities laws (Securities Act §17(a); Exchange Act §10(b)/Rule 10b-5) and common-law fraud/misrepresentation theories for investors, lenders, or counterparties who relied on the false financials or on collateral that wasn’t actually available.
VHL Law’s Role
VHL Law is investigating potential recovery actions on behalf of:
i. investors who bought into the 777/600 preferred-equity offering between 2021–2024;
ii. lenders or credit-facility participants who later discovered the collateral was impaired or double-pledged; and
iii. business counterparties who were induced to transact based on misstatements of 777’s financial condition.
To request a review of your exposure or potential claim, contact:
Ralph Longo, IV Esq.
(305) 371-8064
rl@vhllaw.com
Disclaimer: This communication is for informational purposes only and does not constitute legal advice. Reading it does not create an attorney-client relationship. Every matter depends on its own facts. Past results do not guarantee a similar outcome. This communication was prepared by VHL Law, P.A. (Ralph Longo, Esq.), a law firm based in Miami, Florida.