A prominent Southern California businessman known as an “Anti-Poverty Advocate” was arrested after allegedly conspiring with a Venice man to defraud two investors of at least $145 million, according to federal prosecutors.

Joseph Neal Sanberg, 45, of Orange, who co-founded Marina del Rey-based financial technology company Aspiration Partners Inc. and was an early investor in meal delivery service Blue Apron — was arrested, prosecutors said in a statement.

Prosecutors allege Sanberg obtained $145 million in loans secured by his alleged co-conspirator, 51-year-old Ibrahim Ameen AlHusseini. Sanberg allegedly knew that AlHusseini didn’t have the funds to cover the loans if Sanberg defaulted, but hid that fact from investors. Sanberg then defaulted on the loans, leading to losses totaling at least $145 million, according to the U.S. Attorney’s Office.

Sanberg started negotiating a $55 million loan in January 2020 from “Investor Fund A,” in which he pledged 10.3 million shares of Aspiration Partners stock as collateral, according to prosecutors. Aspiration Partners was a non-public company without a liquid market to sell stock, so Investor Fund A required Sanberg to find someone to buy the shares as a hedge against the risk that the shares could not be sold on the open market.

Investor Fund A, unaware of the reported fraud, approved the loan to Sanberg and purchased the put, or sales, option for AlHusseini. He received about $6 million of the $55 million loan for guaranteeing Sanberg would repay it.

In November 2021, Sanberg allegedly refinanced his loan with “Investor Fund B,” and that fund loaned him $145 million against the same 10.3 million shares in Aspiration.

The investor fund and AlHusseini agreed that he would have to pay $65 million if Sanberg defaulted on the loan, but the pair allegedly used a falsified brokerage account and bank statements to make it seem like AlHussieni had the funds to cover that payment. AlHusseini then received another premium payment of about $6.3 million for guaranteeing repayment of the loan.

In November 2022 and spring 2023, Sanberg defaulted on the loan. Investor Fund B tried to get AlHusseini to purchase the pledged shares of Aspiration Partners stock, but he reportedly never did, resulting in losses of at least $145 million.

AlHusseini pleaded guilty Monday to wire fraud for allegedly falsifying documents and information to assist Sanberg. AlHusseini received $12.3 million in payments through the scheme, according to his plea agreement.

He was arrested on Oct. 7 and has been out on bond since Nov. 13. AlHusseini is scheduled for sentencing on Sept. 29.

If convicted, Sanberg could face a maximum sentence of 20 years in prison. AlHusseini also faces a maximum penalty of 20 years in prison.

A July 2024 story by Bloomberg said Aspiration Partners was unraveling on dubious deals. It was known for a debit card designed for sustainable shopping and the company was promoting renewable energy, clean technology, tree-planting and reforestation projects.

“‘Clean rich is the new filthy rich,’ was displayed on billboards and building walls from Los Angeles to Brooklyn,” the Bloomberg story said.

By last summer, Bloomberg reported: “But today Aspiration is struggling to stay afloat and faces an investigation by U.S. authorities, including the Department of Justice and the Securities and Exchange Commission.”

Last year, Sanberg described himself as an “Anti-Poverty Advocate” as he promoted what turned out to be a failed ballot proposition to raise California’s minimum wage.