Founder And Managing Director Of Investment Firm Sentenced For Fraud And Money Laundering

Sean S. Buckley, Attorney for the United States, Acting under Authority Conferred by 28 U.S.C. § 515, announced today that JOHN ARTHUR HANRATTY, the founder and managing director of a multimillion-dollar municipal tax lien investment firm, was sentenced by U.S. District Judge Lorna G. Schofield to 12 months and a day in prison for his role in a fraudulent scheme to steal nearly $20 million from a Federal Deposit Insurance Corporation ("FDIC")-insured bank. In August 2025, HANRATTY was convicted following a jury trial of wire fraud, bank fraud, and money laundering.

"John Arthur Hanratty scammed his bank by falsely claiming to own millions of dollars of assets to secure more than $20 million in loan advances," said Attorney for the United States Sean S. Buckley. "In reality, the bank was left without the promised collateral and suffered millions in losses. The defendant's conduct, which occurred over the course of years, jeopardized the bank's lending ability. Today's sentence holds the defendant accountable for his conduct."

As reflected in the Indictment, public filings, and the evidence presented at trial:

HANRATTY was the Founder and Managing Director of Ebury Street Capital, LLC ("Ebury Street Capital"), an investment firm with a portfolio primarily comprised of municipal tax liens. HANRATTY has also been an attorney licensed to practice law in the State of New York since 2002 and held legal and compliance positions at well-known investment firms and financial institutions, including serving as the Chief Compliance Officer and General Counsel for a trading broker-dealer.

Between 2017 and 2021, HANRATTY participated in a fraudulent scheme to steal money from an FDIC-insured bank ("Victim Bank-1") by drawing down on commercial lines of credit that had been extended to Ebury Street Capital. Specifically, HANRATTY made materially false statements about the tax lien collateral pledged to Victim Bank-1, inflating the value of that collateral by millions of dollars by adding supposed assets that Ebury never owned. As a result of HANRATTY's misstatements, Victim Bank-1 was defrauded of over $20 million. In addition, HANRATTY falsely told both his investors and Victim Bank-1 that the tax lien collateral was managed by an independent third-party custodian, when, in reality, that was not true. HANRATTY fabricated records to hide the truth about Ebury's actual assets and the independent custodian. The defendant's fraud ultimately resulted in nearly $20 million of losses for Victim Bank-1. Ebury investors also lost more than $8 million in investment capital when the defendant's fraud unraveled and Ebury collapsed. After fraudulently obtaining money from Victim-1, the defendant laundered that money through his business accounts for his own ends.

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In addition to the prison term, HANRATTY, 51, of Little Silver, New Jersey, was sentenced to two years of supervised release and ordered to forfeit approximately $17.7 million, with restitution to follow.

Mr. Buckley praised the outstanding investigative work of the Federal Bureau of Investigation, and also thanked the FDIC Office of the Inspector General for their assistance.

The prosecution of this case is being handled by the Office's Complex Frauds and Cybercrime Unit. Assistant U.S. Attorneys Andrew Chan, Nicholas Chiuchiolo, Danielle Kudla, and Adam Sowlati are in charge of the prosecution, with assistance from Paralegal Specialist Alexander Ross.