| FOR IMMEDIATE RELEASE December 23, 2008 WWW.USDOJ.GOV/USAO/CAN |
SAN FRANCISCO – Last week’s sentencing’s of Ashraf “Mike” Ali and his wife, Yasmin Ali, along with the corporations they owned and controlled, mark the conclusion of one of the largest and most extensive loan fraud schemes ever uncovered by the Small Business Administration in the western United States, announced United States Attorney Joseph P. Russoniello.
On December 18, Ashraf Ali and Yasmin Ali, were sentenced in separate hearings before Judge Marilyn Hall Patel and Judge Phyllis J. Hamilton. The felony convictions are the result of an investigation into a series of fraudulent loan applications with the SBA that exceeded $4 million.
Ashraf Ali, 55, of Pleasanton, Calif., was sentenced by Judge Patel to 13 months imprisonment, ordered to pay a fine of $1.2 million and serve a term of three years of supervised release as a result of his conviction for conspiracy to make false statements to influence banks, a violation of 18 U.S.C. 371. Shawn Corporation and AASIM Enterprises were also convicted of felonies -- money laundering and conspiracy, respectively -- for the companies’ role in the fraudulent loan scheme. Yasmin Ali, 52, also of Pleasanton, was sentenced by Judge Hamilton to three years probation, including six months of house arrest, 150 hours of community service and a fine of $100,000, as a result of her conviction for harboring illegal aliens, a violation of 8 USC 1324.
Ashraf Ali, together with his wife, Yasmin, owned and/or controlled a series of convenience stores throughout the Bay Area and Northern and Central California. From 1998 through 2003, Ashraf Ali organized a scheme with other store owners and partners to submit false loan applications to lenders throughout the Bay Area in order to obtain loans guaranteed by the Small Business Administration. Ashraf Ali misrepresented the true identity of the actual store owners or the source of the down payments for the loans in order to qualify for an SBA program to which he was ineligible. As a consequence of his scheme, Ashraf Ali’s licenses to sell liquor were revoked by or relinquished to California Alcohol Beverage Control.
Yasmin Ali admitted to harboring up to 24 illegal aliens in connection with their employment at the stores owned and controlled by the Alis. She admitted that she had assisted in the concealment of individuals from immigration authorities in that she knew or recklessly disregarded were neither United States citizens nor lawfully residing in the United States for purposes of avoiding their detection by the immigration authorities. The issue of potential restitution to victims of this scheme will be decided at a hearing before Judge Hamilton, which is scheduled to be held in March 2009.
In addition to the Alis, the following defendants have been convicted and sentenced to probation, with various conditions, and assessed a cumulative penalty of fines, forfeiture and restitution in excess of $200,000:
As with Ashraf Ali, all of the above-listed defendants agreed to a series of penalties with California ABC. California ABC had all of the individual’s licenses to sell liquor revoked or otherwise relinquished. These sentences cap the end of the investigation and prosecution of a complex, multi-person conspiracy. All of the defendants sentenced by the Court who obtained SBA loans have agreed to repay those loans, which totaled $4,384,000. More than $4 million has already been repaid.
Due to the wide-ranging nature of the violations committed by Ashraf Ali and the other defendants – including loan fraud, money laundering, immigration violations, and employment scams – the investigation required the expertise of senior agents from the Federal Bureau of Investigation, Small Business Administration Office of Inspector General, Internal Revenue Service/Criminal Investigation, U.S. Immigration and Customs Enforcement, the United States Department of Agriculture Office of Inspector General, and the United States Department of Labor Office of Inspector General. Each agency brought to bear its specific expertise to the investigation that ultimately involved a massive, multi-jurisdiction search warrant at more than twenty sites that was executed simultaneously in November 2003. This cooperation continued during the months leading up to indictment in September 2004 and throughout the legal action that ensued.
This investigation also highlights how federal and state agencies can bring their distinct law enforcement powers to bear on individuals who attempt to defraud government at the federal, state, and local levels. California ABC, with its unique powers of criminal and civil enforcement, worked with federal agents during the early stages of investigation as well as during the execution of the multiple search warrants in November 2003.
Timothy J. Lucey is the Assistant U.S. Attorney who is prosecuting the case with the assistance of Ponly Tu and Ana Guerra. The prosecution is the result of a five-year investigation by the FBI, the SBA/OIG, the IRS/CI, ICE, USDA/OIG, US DOL/OIG, and the California ABC.
Further Information:
Case #s: 04-0292 PJH, 04-0293 MHP
A copy of this press release may be found on the U.S. Attorney’s Office’s website at www.usdoj.gov/usao/can.
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