Cheshire Woman Sentenced to Prison for Fraud and Tax Offenses Stemming from Nearly $1 Million Embezzlement Scheme
John H, Durham, United States Attorney for the District of Connecticut, announced that JANZAYB KHAN, 29, of Waterbury, waived his right to be indicted and pleaded guilty today before U.S. District Judge Jeffrey Alker Meyer in New Haven to one count of conspiracy to commit bank fraud and one count of making a false oath in a bankruptcy proceeding in connection with a credit card “bust-out” scheme that defrauded more than a dozen financial institutions.
According to the court documents and statements made in court, KHAN provided his personal information to a co-conspirator so that the co-conspirator could obtain credit cards in KHAN’s name. In total, the co-conspirator obtained 31 credit cards in KHAN’s name from more than a dozen financial institutions. In many cases, the credit card applications contained false statements about KHAN’s income, assets, address and employment history. Then, within a short period in January 2013, nearly all of the available credit on the cards were rapidly utilized or “busted out.” More than $59,000 was spent on cash advances, gift cards and precious metals. Some of the proceeds from the cash advances were deposited and/or transferred to bank accounts in the name of KHAN’s co-conspirator and/or the co-conspirator’s relatives.
In addition, almost $70,000 was charged in sham transactions at three merchants, who then issued checks from the proceeds that were later deposited into bank accounts in the name of the co-conspirator and/or the co-conspirator’s relatives.
The co-conspirator paid KHAN approximately $10,000 in cash for his role in the scheme.
After the bust-out, there was more than $165,954 in accumulated debt on the 31 cards in KHAN’s name. In June 2013, KHAN filed for Chapter 7 bankruptcy in U.S. Bankruptcy Court and attempted to discharge all of his credit card debt. In his bankruptcy court filings, KHAN falsely stated that the majority of his debt was due to gambling losses as casinos. KHAN also made a number of other false statements under oath during an examination by the U.S. Trustee in his bankruptcy case. The U.S. Bankruptcy Court later denied the discharge of KHAN’s debts.
KHAN was arrested on a federal criminal complaint on April 4, 2017.
Judge Meyer scheduled sentencing for March 5, 2018, at which time KHAN faces a maximum term of imprisonment of 35 years.
This matter is being investigated by the U.S. Secret Service and is being prosecuted by Assistant U.S. Attorney Neeraj N. Patel.