California Jewelry Store Owner Convicted of Conspiracy to Defraud the United States and Conspiracy to Launder the Proceeds of Bank Fraud
A federal jury sitting in Santa Ana, Calif., on Wednesday, Nov. 21, 2012, convicted Safieh Fard of one count of conspiracy to defraud the Internal Revenue Service (IRS) and one count of conspiracy to launder the proceeds of bank fraud obtained after submitting fraudulent mortgage applications, the Justice Department and IRS Criminal Investigation announced. Fard’s co-conspirators, her sister Sedigheh Bahramian, and two of her sons, Mohsen Kikalaye and Ahmad Kikalaye, pleaded guilty to related counts of bank fraud in 2010.
According to the indictment and evidence introduced at trial, starting in 1997 and continuing through 2004, Fard and her co-conspirators purchased valuable residential real estate properties, including numerous beachfront properties in Newport Beach, Calif. In order to obtain mortgages to purchase these properties, Fard and her co-conspirators provided false information to federally-insured banks that substantially overstated their income and assets on mortgage applications. Fard submitted mortgage applications that falsely stated she earned over $40,000 per month, despite claiming no taxable income on her federal income tax returns during the eight year conspiracy.
The evidence also established that Fard and her co-conspirators bought, sold, and transferred ownership of the properties between and among themselves. Ultimately, the properties were sold to third parties resulting in substantial monetary gain. Fard and her co-conspirators then failed to report capital gains on more than $3.7 million from these sales on their federal income tax returns.
The evidence further established that Fard and her co-conspirators Mohsen Kikalaye and Ahmad Kikalaye sold Newport Beach properties to unrelated third parties and received the proceeds in a large lump-sum payment by either wire transfer or check. Fraud proceeds were then transferred through multiple bank accounts to an account in the name of Fard’s co-conspirator Ahmad Kikalaye, who withdrew proceeds in cash in amounts slightly below the $10,000 federal reporting requirement. Fraud proceeds were also used to buy new real estate properties.
Sentencing is scheduled for April 8, 2013.
Kathryn Keneally, Assistant Attorney General for the Justice Department’s Tax Division, commended the efforts of special agents from IRS Criminal Investigation and U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations of Orange County, Calif., who jointly investigated the case, and Tax Division Trial Attorneys Erin S. Mellen and Mark L. Williams, who prosecuted the case with valuable support from the U.S. Attorney’s Office for the Central District of California.