Joseph Sanberg, the multimillionaire California Democrat activist and co-founder of Aspiration, was arrested on Monday on charges related to a scheme to defraud investors of at least $145 million. Sanberg, 45, of Orange, California, faces federal charges after allegedly conspiring with board member Ibrahim AlHusseini to falsify financial documents and defraud two investor funds.
According to the U.S. Attorney’s Office for the Central District of California, Sanberg and AlHusseini conspired to mislead investors about the financial stability of Aspiration, a “green” finance company backed by Hollywood stars Leonardo DiCaprio and Robert De Niro. The company had marketed itself as a climate-friendly banking platform, offering users the opportunity to “do good” and “do well” by investing in sustainable practices.
The fraud centered around a loan deal secured by Aspiration shares, which, according to prosecutors, was based on falsified bank statements. The scheme led to at least $145 million in losses when Sanberg failed to repay the loans, and AlHusseini, who allegedly falsified the financial documents, did not follow through on buying the shares as promised.
AlHusseini, who had already pleaded guilty to wire fraud, received $12 million for backing the loan but was later found to have transferred significant sums, including $300 million to Saudi Arabia, in an attempt to avoid paying the judgment. This case mirrors similar high-profile frauds, such as the collapse of FTX, as Aspiration also garnered attention for its marketing and hype in the green finance sector.
The Justice Department has indicated that additional charges may follow, as their investigation continues into Aspiration’s questionable financial practices, including inflated revenue and possibly misleading customers about the carbon offsets they were purchasing. The company had also planned to go public, but that effort collapsed after attracting significant investments from high-profile figures like former Microsoft CEO Steve Ballmer.
Sanberg faces up to 20 years in prison if convicted of the charges. The case highlights the risks involved in “green” finance, especially as firms like Aspiration blend ideological messaging with financial promises that may not always hold up under scrutiny.
