Derek Wachob Lawsuit: Wire Fraud, $26M Judgment, Bankruptcy

Derek Wachob, the former CEO of Oklahoma steel pipe manufacturer Paragon Industries, is at the center of a federal wire fraud prosecution and a wave of civil litigation. Federal prosecutors in the Southern District of New York charged him on November 18, 2025, with one count of wire fraud tied to an alleged $66 million scheme to defraud investors, a bank, an investment firm, and steel pipe distributors.¹ On top of the criminal case, Wachob and Paragon face civil lawsuits totaling more than $300 million, and Paragon itself is in Chapter 11 bankruptcy.²

The Federal Wire Fraud Indictment

A federal grand jury indictment unsealed on November 18, 2025, accuses Wachob of running the scheme from approximately October 2022 through August 2024. Federal agents arrested him at his home in Sapulpa, Oklahoma, the same day the indictment was unsealed. Witnesses described an armored vehicle and multiple unmarked vehicles entering the property before Wachob was taken into custody.³

Prosecutors allege that Wachob solicited money by falsely promising business opportunities tied to future steel purchases, then diverted the funds to prop up his debt-laden company and to bankroll what the government called an “extravagant lifestyle” of vacation homes, private jets, helicopters, yachts, and expensive cars.¹ U.S. Attorney Jay Clayton called Wachob’s public persona “an image built on lies.”³

The indictment identifies four categories of alleged victims:

More than $41 million taken between 2023 and 2024 from individual investors, some of whom prosecutors described as “some of his closest friends.”
A $10 million loan sought in January 2024 from a Texas bank, based on alleged misrepresentations about how the money would be used.
$7.3 million obtained from an investment firm through lies about the purpose of the funds.
Roughly $7.4 million taken from at least two steel pipe distributors through false promises about future steel purchases.⁴

The wire fraud count carries a maximum sentence of 20 years in prison. Wachob also faces mandatory forfeiture of any property acquired with fraud proceeds.⁵ The matter is assigned to U.S. District Judge J. Paul Oetken in Manhattan under case number 25-CR-508. As of early 2026, the criminal case remained in its preliminary stages, with no plea, trial date, or resolution publicly recorded. The Department of Justice has noted that the charge is “merely an accusation” and that Wachob is “presumed innocent unless and until proven guilty.”¹

The Braver Case and $26 Million Judgment

The largest resolved civil action was brought by Skip Braver and Chad Braver, Florida investors and former friends of Wachob. Their October 2024 complaint in the Southern District of Florida alleged that Wachob had promised to split profits from buying and reselling steel and to match their investments dollar for dollar, while concealing that Paragon was already about $45 million in debt. According to the Bravers, Wachob spent their money on his personal lifestyle.⁶

The parties settled for $26 million, due by June 27, 2025, with the contract specifying that “time is of the essence.” When the defendants missed the deadline, the court found a material breach; the corporate defendants also failed to retain replacement counsel after their attorneys withdrew.⁷ On August 11, 2025, Judge Beth Bloom entered a stipulated final judgment, crediting partial payments against the $26 million.⁸

The Bravers have pursued enforcement since. By June 2026, Judge Bloom ordered disbursement of $57,334.33 plus accrued interest to each plaintiff from the auctioned proceeds of a condominium owned by The Olympia of Destin, LLC, a Wachob-affiliated entity.⁸ Wachob himself reportedly bid $1,806,000 to repurchase a commercial property in Glenpool, Oklahoma, that had been seized to satisfy his debts.⁹

Other Civil Lawsuits

Multiple steel suppliers, lenders, and investors have sued Wachob and Paragon. Several of the cases against Paragon have been stayed by its bankruptcy filing.

Steel Suppliers

AM/NS Calvert LLC sued Paragon on September 27, 2024, in the Northern District of Illinois, seeking $31.5 million plus interest. The claim covers more than $15 million in unpaid products bought between January 2023 and May 2024, plus over $16 million in losses tied to a May 2023 consignment agreement.² Nucor Corporation sued on October 3, 2024, in the Eastern District of Arkansas, seeking $32 million plus $8 million in accumulating interest for 47 unpaid orders of sheet steel placed between April and August 2022.¹⁰

Amarillo National Bank

Amarillo National Bank sued Paragon and Wachob on September 25, 2024, over non-payment of a $10 million loan. On December 2, 2024, a Texas judge entered a final judgment ordering Paragon to pay the full $10 million plus 18% interest.¹¹

CTAP and Sooner Pipe

On November 6, 2024, CTAP, a Colorado piping company, and Sooner Pipe filed suit alleging that Paragon was holding $67 million worth of their steel coils and piping. The plaintiffs claimed that $12 million of their inventory was unaccounted for and said they believed it was “being shipped by the truckloads to unknown destinations.”²

The $11 Million Powerboating Investor Suit

In November 2024, three members of the high-performance powerboating community, Mark Schouten of Arizona, Jacob Nossaman of Oklahoma, and Zane Mead of Texas, filed an $11 million lawsuit in Tulsa County District Court against Wachob, Global Source Recycling LLC, Paragon, and related companies. They alleged they had invested in a steel purchase that Wachob was supposed to match with a $3 million contribution of his own. According to the complaint, the defendants “failed and refused to either show proof the investment was legitimate or return the invested funds.” The suit was refiled in January 2025.¹²

TLLP, LLC

TLLP, LLC filed a $7.6 million suit against Paragon and Global Source Recycling on September 10, 2024. TLLP had loaned money to Global Source Recycling with collateral stored on Paragon-owned land in Muskogee, Oklahoma. When Global Source defaulted, the collateral was supposed to ship to TLLP immediately, and according to the complaint, that never happened.¹¹

Paragon’s Bankruptcy and Asset Seizures

Paragon was Sapulpa’s largest employer.¹³ Its financial distress became public in late 2024 when it slowed operations and issued WARN Act notices about potential permanent layoffs between December 2024 and January 2025. By January 2025, employees reported going weeks without pay.⁶ In March 2025, Byline Bank obtained a court-ordered receivership over Paragon after the company defaulted on an $18 million loan.²

On May 21, 2025, Paragon filed for Chapter 11 bankruptcy in the Oklahoma Eastern Bankruptcy Court, case number 7:25-bk-80433, before Judge Paul R. Thomas. As of June 2026, the company had filed a fourth motion to extend the exclusivity period for submitting a Chapter 11 plan, with a hearing scheduled for August 2026.¹⁴

Authorities have also moved against assets tied to Wachob’s alleged spending. A yacht owned by Wachob was seized as part of the ongoing legal proceedings,¹⁵ and he had been selling luxury cars and personal assets in the wake of the market downturn and layoffs in late 2024.

1
U.S. Department of Justice. Chief Executive Officer of Steel Manufacturer Charged in $66 Million Fraud Scheme
2
News On 6. Timeline: Paragon Industries Faces Financial Issues, Lawsuits
3
Sapulpa Times. Paragon CEO Derek Wachob Arrested, Charged in $66 Million Fraud Scheme
4
FOX23 News. CEO of Paragon Industries Arrested in Sapulpa on Federal Wire Fraud Charge
5
KRMG. Paragon Industries CEO Derek Wachob Arrested on Complaint of Wire Fraud
6
News On 6. “I Put My Heart Into the Company” — Sapulpa Man Afraid to Lose Everything After Not Getting Paid
7
Midpage. Braver v. Wachob, 1:24-cv-24048
8
PACER Monitor. Braver et al v. Wachob et al, 1:24-cv-24048
9
News On 6. Former Paragon CEO Wins Bid to Buy Back Seized Glenpool Property
10
CourtListener. Nucor Corporation v. Paragon Industries Inc, 3:24-cv-00182
11
News On 6. New Lawsuit Filed Against Sapulpa’s Paragon Industries as Layoffs Loom
12
Speed on the Water. Performance Boat Enthusiast Trio Brings Suit Against Wachob and Related Companies
13
News On 6. Major Sapulpa Employer Facing Financial Trouble, Possible Layoffs Amid Lawsuits
14
PACER Monitor. Paragon Industries Inc, 7:25-bk-80433
15
News On 6. Authorities Seize Yacht Owned by Paragon Industries Owner Amid Multi-Million Dollar Legal Battle