You can build an industrial empire on brakes, filters and windshield wipers. You can also, US prosecutors say, build part of it on invoices that never existed. Patrick James, founder and CEO of First Brands, and his brother Edward were charged in New York over a multibillion-dollar fraud.

$2.7 billion in fake receivables

According to the Department of Justice, from 2018 to 2025 the brothers allegedly inflated and faked invoices, pledged the same collateral multiple times, falsified financial statements and hid debt from lenders. At bankruptcy, factors held about $2.7 billion in fake receivables.

A federal courthouse in Ohio.
Photo: Wikimedia Commons — CC0 — The James brothers were arrested in Ohio; the case is being handled in New York.

A giant reporting $12 million in cash

First Brands reported about $5 billion in annual sales. Yet at bankruptcy it declared just $12 million in cash… against more than $9 billion in liabilities. A staggering gap that triggered the collapse and left lenders and creditors facing huge losses.

😏 The cynical take
The group made windshield wipers, meant to make the road clearer. Its accounting, by contrast, allegedly served mainly to blur the lenders' view.

Magouilles & Compagnie's verdict

A crown jewel of auto parts in ashes, $2.7 billion in phantom receivables and $9 billion in debt: the First Brands case is an industrial shipwreck crossed with an accounting thriller. US prosecutors must prove it; until then, presumption of innocence.