O.C. Man Sentenced to 41 Months in Federal Prison for Investment Scam that Defrauded Local Businessman out of Nearly $650,000
SANTA ANA, California – An Orange County man who was convicted at trial of defrauding a local businessman through a fraudulent investment scheme was sentenced this morning by United States District Judge David O. Carter to 41 months in federal prison.
Aiman Alexander Ataba, 52, of Irvine, was found guilty on March 20, 2018, of eight counts of mail fraud and three counts of money laundering. The jury’s verdicts followed a two-day trial in the United States District Court in Orange County.
The jury found that Ataba defrauded a Riverside County man out of $648,070 by convincing him to invest in Ataba’s Fountain Valley business, Innovation Validation and Design Technologies. Ataba falsely claimed that the investments would be used to manufacture and sell a device that would be used in hospitals for stem cell research.
Ataba claimed that his company was on the verge of being acquired, and he told the investor that stock in the company could be obtained at a discounted price if he invested quickly. Based on Ataba’s false representations, the victim invested $648,070 in Ataba’s company over the course of 4½ years.
According to court records, after receiving the victim’s money, Ataba immediately spent the money on personal expenses. The money was not invested in any company for the development of a device involving stem cell research. Instead, Ataba simply misappropriated and converted all of the victim’s money to his own personal uses, using the money to pay for rent, living expenses, dining out, and gambling, as well as overseas wire transfers.
Ataba diverted funds from his business account to his personal account and made approximately $350,000 in cash withdrawals. Many of the withdrawals were made at casinos in Las Vegas and on local Indian reservations. Some of the victim’s money was spent to purchase a new Toyota vehicle, which was seized in 2016 by the Federal Bureau of Investigation.
In addition to imposition of the prison term, Judge Carter today ordered Ataba to pay restitution to the victim in the amount of $648,070.
The investigation into Ataba was conducted by the Federal Bureau of Investigation.
The case was prosecuted by Assistant United States Attorneys Robert J. Keenan and Gina J. Kong of the Santa Ana Branch Office.