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Tag: Beverly Hills

  • 3 Plead Guilty In Bizarre Shakedown Bid In Anthony Vassallo/EIMT Ponzi Case; 1 Pleads To Conspiracy To Impersonate An Officer

    Three individuals who attempted to shake down the operators of a hedge fund associated with the alleged Equity Investment Management and Training Inc. (EIMT) Ponzi scheme have pleaded guilty in California for their roles in the shakedown bid.

    Craig Anderson, 39, of Chicago, pleaded guilty to conspiracy to impersonate a federal officer and employee; Cassandra Moore, 26, of Beverly Hills, Calif., pleaded guilty to a misdemeanor count of unlawfully possessing false documents, as did Sean Smartt, 41, of Sacramento.

    The FBI described the crime as “bizarre,” when the shakedown charges were announced in May 2009. In announcing the guilty pleas today, federal prosecutors said the shakedown attempt occurred after a fake meeting was arranged in March 2009 under the guise that a wealthy investor wanted to meet figures associated with EIMT.

    Also participating in the shakedown scheme was Michael David Sanders, 41, of Fair Oaks, Calif., prosecutors said. Sanders has pleaded not guilty. His trial is set to get under way next month.

    “Once the individuals were inside the office, Anderson tapped on the window with an identification badge to gain entry,” prosecutors said. “Sanders, Anderson, Moore, and Smartt entered, wearing bulletproof vests, earpieces, and credentials falsely bearing identification information and the authentication feature of the United States.

    “They carried handcuffs, badges, and some carried radios and appeared to be armed leaving the impression that they were federal law enforcement agents,” prosecutors said.

    Anderson, Moore, and Smartt now “admit that Sanders and Anderson paced around the office, exposed their weapons, and blocked the entrances and exits of the office suite,” prosecutors said. “One of the co-conspirators told the hedge fund operators that the defendants were there to collect funds taken from the . . . (EIMT) account on behalf of fraud victims.”

    Anderson, prosecutors said, “told the hedge fund operators that they had until noon on Monday, March 9, 2009, to wire $378,300.16 to a Patelco Credit Union account in the name of the ‘Spirit Foundation’ and to send an e-mail confirmation,” prosecutors said. “The defendants left a sheet of paper with the wiring instructions, routing number, account number, bank name, amount, and an e-mail address.”

    Anderson faces a maximum of five years in federal prison. His sentencing is set for April 27, before U.S. District Judge John A. Mendez.

    Smartt and Moore are set to be sentenced on April 25 and 26, before U.S. District Judge Gregory G. Hollows. They face up to a year in prison.

    Anthony Vassallo was charged in April 2009, with mail fraud, wire fraud, and money laundering, amid allegations he operated the $40 million EIMT Ponzi scheme.

    Vassallo has pleaded not guilty.

  • Iranian-Americans Targeted In Beverly Hills Investment- And Affinty-Fraud Scheme, SEC Says; Debentures Program Allegedly Pitched On Persian-Language Radio Show

    UPDATED 7:03 P.M. ET (U.S.A. JAN. 12) A Beverly Hills radio host pitched his fraud scheme in Persian and targeted Iranian-Americans in Greater Los Angeles, the SEC said today.

    Client funds were used to build a mansion for John Farahi, 52, and and his wife, Gissou Rastegar Farahi, 50, the agency said. Client funds also were transferred to the Farahi Family Trust. John Farahi hosts the daily radio program.

    Named defendants in the case were the Farahis, Beverly Hills-based NewPoint Financial Services Inc. and Elaheh Amouei, 54. The SEC identified Amouei as NewPoint’s controller and the “personal bookkeeper” of the Farahis.

    A company named Triple “J” Plus LLC operated by John Farahi was named a relief defendant. John and Gissou Farahi have control over the Triple “J” bank accounts, the SEC said.

    “They lured victims with false promises of investment safety while secretly enriching themselves and diverting investor funds for their personal use,” said Rosalind R. Tyson, director of the SEC’s Los Angeles Regional Office.

    All of the defendants’ assets have been frozen in the case, which includes allegations that clients were told they were investing in FDIC-insured certificates of deposit, government bonds or corporate bonds issued by companies backed by funds from the Troubled Asset Relief Program (TARP).

    TARP is the $700-billion program operated by the Treasury Department to shore up banks.

    “The vast majority of the money raised was transferred to accounts held by Defendants John and Gissou Farahi,” the SEC said in its complaint. “John and Gissou Farahi, in tum, used the investor funds to, among other things, construct a multi-million dollar personal residence in Beverly Hills, California and to engage in risky options futures trading in the stock market in which . . . John and Gissou Farahi lost more than $18 million in 2008 and the beginning of 2009.”

    Investors were asked to invest in the debentures by the Farahis and/or Elaheh Amouei, NewPoint’s controller, after making an appointment to discuss investment opportunities offered by NewPoint, the SEC said.

    Since at least 2003, NewPoint has sold more than $20 million worth of debentures to more than 100 investors. Clients were told their investments were low-risk, the SEC said.

    At some point, NewPoint prepared Private Placement Memoranda (PPM) literature describing the opportunity as high risk, but most investors said they never received the material, the SEC said. Investors also did not know that they were making loans to John Farahi.

    “[N]ot only did Defendants John and Gissou Farahi and/or Defendant Amouei fail to provide the PPMs to most investors, it appears that they only added the disclosure regarding loans to Defendant John Farahi in 2009, after the offering ceased, the SEC said.

    “[T]he vast majority of the money raised was actually transferred to accounts controlled by the Farahis, including an account at relief defendant Triple ‘J,’” the SEC said.

    Beginning roughly in June 2009, the SEC said, John Farahi and Amouei “made further misrepresentations to investors in an effort to lull them into keeping their money with NewPoint.

    “Investors have allegedly been told that their money is safe and that they are guaranteed to get the entirety of their investment back — despite the fact that NewPoint lacks sufficient funds to make all investors whole,” the SEC said. “John Farahi has also paid back some investors on a selective basis while failing to return money to other investors who have asked for a return of their investment.”

    Amouei, accordring to the SEC, “falsely told some of the investors who have not received a return of their investment that NewPoint was unable to return their money because the Commission has frozen NewPoint’s financial accounts.”

    The NewPoint case in California became the second fraud case since November in which a radio show allegedly was used to pitch a fraudulent  investment program.

    Christian radio host Pat Kiley of Minnesota was accused by the SEC and the CFTC in November of promoting a $190 million Ponzi scheme with Trevor Cook, who reportedly used some of the proceeds to buy a submarine to access a private island he bought in Canada.