A Fram oil filter. Fram falls under the First Brands Group umbrella. (Fram via LinkedIn)
January 29, 2026 1:04 PM, EST
First Brands Group founder Patrick James and his brother Edward, a former executive at the company, were indicted by federal prosecutors in New York following the collapse of the bankrupt auto parts maker last year.
The duo engaged in a series of schemes to defraud the company’s lenders and financing partners, according to the indictment. The brothers faked and inflated invoices for accounts receivable, double- and triple-pledged loan collateral, falsified financial statements and hid liabilities from lenders, the U.S. alleged.
“These schemes yielded billions in dollars in financing to First Brands and enabled Patrick James and Edward James to reap millions of dollars in proceeds derived from their fraud,” according to the indictment. They helped the company to grow but also “sowed the seeds of First Brands’ demise.”
The brothers were each charged with nine counts, including continuing financial crimes enterprise, wire fraud, bank fraud, conspiracy to commit wire fraud and conspiracy to commit money laundering.
The top charge, operating a continuing financial crimes enterprise, carries a maximum punishment of life in prison.
“Patrick James is presumed innocent and denies these charges,” his spokesman said in an emailed statement. “He built First Brands from nothing into a global industry leader and has always been devoted to the success of the company. Mr. James looks forward to presenting his case in court.”
Patrick James’ lawyers have previously denied similar allegations of wrongdoing asserted by First Brands’ bankruptcy advisers and lenders and attributed the company’s financial troubles to macroeconomic factors like tariffs.
James has also blamed lenders for First Brands’ bankruptcy, saying in court papers that the firms that provided his company with off-balance sheet financing engaged in “predatory” practices and charged onerous fees. Lenders have denied James’ claims and blamed First Brands’ Chapter 11 case on alleged fraud involving the former CEO.
James resigned as CEO in October, shortly after First Brands filed Chapter 11.
Edward James also exited as executive vice president soon after the company sought court protection, according to bankruptcy papers. He has been sued by the company and creditors for allegedly conspiring to defraud creditors out of billions of dollars of property.
Lawyers for Edward James didn’t immediately return messages seeking comment.
The case is U.S. v James, 26-cr-29, US District Court, Southern District of New York
