The Family Behind Fatburger is Under Investigation for Alleged Fraud

According to court records, federal authorities have been investigating Andrew Wiederhorn, the chief executive of the company that owns the Fatburger and Johnny Rockets restaurant chains.

The investigators are also investigating one of his family member’s actions as part of an inquiry into allegations of securities and wire fraud, money laundering and attempted tax evasion.

Federal agents in December raided the Beverly Grove home of Wiederhorn’s son Thayer and daughter-in-law Brooke Wiederhorn, according to search warrant records filed in court.

Brooke is not named in court records reviewed by The Times but she is the oldest daughter of actress and erstwhile “Real Housewives of Beverly Hills” star Kim Richards.

As part of the probe, agents hauled away phones, digital storage devices, tax documents and other records from the couple’s residence, according to court filings.

Federal investigators also sought a judge’s permission to search the elder Wiederhorn’s Beverly Hills mansion. It is unclear if a raid took place.

In a affidavit last November, outlining the investigation, a special agent for the FBI focusing on complex financial crimes alleged that Wiederhorn, 56, had “devised and executed a fraudulent scheme” to avoid paying taxes and received “millions of dollars in sham loans” through his companies.

The affidavit identifies years of credit card purchases by Wiederhorn, his children, and other relatives — $183,500 at a London jeweler; $150,000 apparently for a down payment on a Rolls-Royce; more than $100,000 to a Beverly Hills divorce attorney — and alleges they were “paid primarily” out of accounts held by an affiliate of the publicly traded FAT Brands.

The filing also alleges that Wiederhorn generated millions of American Express rewards points by routing company money through his son’s PayPal account.

The status of the investigation is unclear. No charges have been filed against any person or against FAT Brands, of which Wiederhorn is the largest shareholder.

Wiederhorn’s attorney, Douglas Fuchs of Gibson, Dunn & Crutcher, said in a statement late Friday that “Mr. Wiederhorn categorically denies these allegations and at the appropriate time we will demonstrate that the government has its facts wrong.”

“These loans were completely legitimate and were independently reviewed and approved. In addition, Mr. Wiederhorn’s tax returns were prepared and approved by independent tax professionals and he has been making payments under a plan approved by the IRS,” Fuchs said in the statement.

“We are unable to comment more specifically on the allegations because despite our requests, the government has refused to provide us with a copy of the affidavit.”

Disclaimer: We have no position in any of the companies mentioned and have not been compensated for this article.