Alex Dee, also known as Alex Dowlatshahi, was arrested in Washington on January 10, 2024, facing federal charges related to the 8 Figure Dream Lifestyle (8FDL) pyramid scheme. His alleged co-conspirators, Brian Kaplan and Jerrold Maurer, also known as Jerry Maurer, were arrested in Colorado and at an undisclosed location respectively, following indictments in Colorado last year. Kaplan's arrest occurred on October 2, 2023, while Dee's indictment was filed on November 7.
From January 2017 through June 2019, Dee allegedly operated 8FDL as a classic pyramid scheme. Operators used emails, robocalls, promotional videos, and webinars to recruit participants. They falsely presented 8FDL as a legitimate business offering valuable digital products and a genuine opportunity for significant income. Recruitment materials frequently showcased testimonials claiming "eight-figure" earnings with minimal effort. These claims were misleading.
The scheme's true nature involved participants paying substantial fees directly to prior members and the founders, rather than for legitimate goods or services. These fees, often ranging into the tens of thousands of dollars, functioned as "gifting" payments. To earn money, members had to recruit new individuals who would then make similar payments, perpetuating the chain. The vast majority of people who joined 8FDL never made any money, typically losing their entire investment. Operators also downplayed ongoing costs, which included not only initial entry fees but also recurring administrative charges, payments for higher membership levels, and marketing tool expenses. Participants often incurred continuous out-of-pocket expenditures in a futile attempt to reach profitability.
The criminal charges follow civil regulatory action taken by the Federal Trade Commission (FTC) in 2019. The FTC's case, which alleged the company engaged in deceptive marketing and operated an illegal pyramid scheme, resulted in a $31.9 million settlement in 2020. However, the practical distribution of these funds to victims often proves challenging, with many individuals receiving only a fraction of their losses, or nothing at all, due to dissipated assets.
In the criminal case, Alex Dee faces four counts of wire fraud and one count of conspiracy to commit wire fraud. Each wire fraud count carries a maximum sentence of twenty years in federal prison, while the conspiracy charge carries a maximum of five years. Brian Kaplan and Jerrold Maurer each face one count of conspiracy to commit wire fraud, a charge that carries a maximum sentence of five years. The indictments were filed in federal court in Colorado.
Kaplan and Maurer both entered guilty pleas to their respective charges. Their sentencing was initially scheduled for December 16, 2024. Dee, however, initially pled not guilty to all charges at his arraignment in late February. His trial was scheduled for October 2024. Court records unsealed in January 2024 for Maurer's case cited a fourth unnamed co-conspirator in the 8 Figure Dream Lifestyle scheme.
In July 2024, Alex Dee changed his plea to guilty on the conspiracy to commit wire fraud charge. On December 16, 2024, all three defendants—Alex Dee, Jerrold Maurer, and Brian Kaplan—were sentenced in federal court.