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March 13, 2015

Justice Department Announces Settlement with California Bank for Knowingly Facilitating Consumer Fraud

Filed under: California Defense Attorney — fayarfa @ 12:06 am

The United States filed a civil complaint in the U.S. District Court for the Central District of California today against Plaza Bank of Irvine, California, for knowingly facilitating consumer fraud by permitting a third-party payment processor to make millions of dollars of unauthorized withdrawals from consumer bank accounts on behalf of fraudulent merchants.  To resolve the case, Plaza Bank has agreed to pay $1.225 million and enter into a permanent injunction that reforms the bank’s practices to prevent such fraud in the future.  The proposed consent decree has been filed with the court, which will determine whether to enter the order.

“Today’s complaint alleges that, in exchange for fee income, the bank ignored its responsibilities and looked the other way while a third-party payment processor and its merchants defrauded unsuspecting victims of millions of dollars,” said Acting Assistant Attorney General Benjamin C. Mizer of the Justice Department’s Civil Division.  “A part of our responsibility at the Justice Department is to stop those who knowingly facilitate consumer fraud, and those in the financial industry are no exception.”

The complaint alleges that from July 2007 to mid-2010, Plaza Bank knowingly permitted fraudulent merchants, acting through an intermediary called a third-party payment processor, to illegally withdraw millions of dollars from consumers’ bank accounts.  The complaint further alleges that these unauthorized withdrawals resulted in: abnormally high rate of rejected transactions, which hovered between 50 and 55 percent; hundreds of consumer complaints each month in which consumers stated, by sworn affidavit, that withdrawals from their accounts were unauthorized; and inquiries from other banks and law enforcement, both of which expressed their belief that the payment processor’s transactions were fraudulent.

According to the complaint, when Plaza’s chief compliance official raised concerns about these numerous warning signs of fraud, she was brushed aside by Plaza’s chief operating officer—who, unknown to the compliance officer, was one of two corporate officials who also happened to be a part-owner of the payment processor.  Plaza thus continued to give fraudsters unfettered access to the bank accounts of tens of thousands of consumers.



Filed under: California Defense Attorney — fayarfa @ 12:03 am

WESTMINSTER – A man is scheduled to be arraigned tomorrow for sexually assaulting a 2-year-old girl and committing lewd acts upon her. Joseph Michael Hishmeh, 21, Garden Grove, is charged with one felony count of sexual penetration with a child 10 years or younger, five felony counts of lewd acts upon a child under 14, and a sentencing enhancement allegation for committing substantial sexual conduct with a child. If convicted, Hishmeh faces a maximum sentence of 31 years to life in state prison. He is being held on $1 million bail and is scheduled to be arraigned tomorrow, Friday, March 13, 2015, at 10:00 a.m. in Department W-12, West Justice Center, Westminster.

Between April 30, 2014, and Sept. 1, 2014, Hishmeh is accused of committing lewd acts upon 2-year-old Jane Doe in his home by touching her breasts, vagina, and legs under her clothes with sexual intent. On one occasion, he is accused of digitally penetrating Jane Doe’s vagina. The evidence was discovered during an investigation by the Federal Bureau of Investigation (FBI).

The FBI continued the investigation with the Orange County Child Exploitation Task Force (OCCETF). On Feb. 9, 2015, OCCETF investigators arrested Hishmeh at his home in Garden Grove.

OCCETF is comprised of members from U.S. Immigration and Customs Enforcement’s Homeland Security Investigations; Orange County Sheriff’s Department; FBI; United States Postal Inspection Service; and Newport Beach Police Department. OCCETF investigates Internet-related crimes against children and crimes involving the possession, production, and distribution of child pornography.


March 12, 2015

Three Indicted For Operating ‘Pay-To-Stay’ Schools That Allegedly Enabled Foreign Nationals To Remain In U.S. As Foreign ‘Students’

Filed under: California Defense Attorney — fayarfa @ 12:09 am

LOS ANGELES – Three Los Angeles-area residents responsible for operating a network of four schools were arrested this morning on federal charges for allegedly helping hundreds of foreign nationals remain in the United States as foreign students, even though they never attended classes.

The three defendants allegedly ran a “pay-to-stay” scheme through three schools in Koreatown – Prodee University/Neo-America Language School; Walter Jay M.D. Institute, an Educational Center (WJMD); and the American College of Forensic Studies (ACFS) – and a fourth school currently operating in Alhambra, Likie Fashion and Technology College.

The three defendants are named in a 21-count indictment returned yesterday by a federal grand jury. The indictment alleges a conspiracy to commit immigration fraud, a host of immigration offenses and money laundering.

The indictment also contains an allegation that would require the defendants to forfeit property and proceeds derived from the fraud scheme, which investigators estimate took in as much as $6 million a year in “tuition” payments.


Man Sentenced to Prison for 2011 Pomona Killing

Filed under: California Defense Attorney — fayarfa @ 12:06 am

A 38-year-old man was sentenced yesterday to 31 years in state prison for a fatal drive-by shooting in Pomona, the Los Angeles County District Attorney’s Office announced.

Ruben Vargas pleaded no contest to four felonies: voluntary manslaughter, attempted murder, assault with a semiautomatic firearm and assault with a deadly weapon with a firearm in case KA093110. The defendant also admitted gun and gang allegations.

Deputy District Attorney Thuy Pham, who prosecuted the case, said on Jan. 4, 2011, Lina Romero, 31, was inside a residence when she was hit by gunfire coming from outside. She was taken to a medical center for treatment and died a month later.

Another woman also was in the home during the shooting but was unhurt, the prosecutor said.

Nine days later, Andrew Alvarez, 25, was arrested in connection with the killing. He pleaded no contest to voluntary manslaughter and assault with a deadly weapon and was sentenced to 25 years and four months in state prison.


Man Charged With Murder in Huntington Park

Filed under: California Defense Attorney — fayarfa @ 12:03 am

A 21-year-old man was charged today with murdering an acquaintance near a police station in Huntington Park last week, the Los Angeles County District Attorney’s Office announced.

Jorge Godoy (dob 3/24/93) was charged in case BA434355 with one count of murder and a weapon allegation. He is scheduled to be arraigned today in Department 30 of the Foltz Criminal Justice Center.

Prosecutors said Godoy was in the 6700 block of Miles Avenue with two other men on March 5 when they were approached by Daniel Ramirez.

Ramirez, who knew all three men, got into an argument with Godoy. Prosecutors said Godoy is accused of pulling out a large-caliber gun and shooting Ramirez in the face. The victim died at the scene and Godoy was arrested a short time later.


March 11, 2015


Filed under: California Defense Attorney — fayarfa @ 6:16 am

WASHINGTON – The Justice Department announced today that it has agreed to a $4.9 million civil and criminal resolution with CommerceWest Bank, of Irvine, California, arising out of the department’s investigation into consumer fraud schemes facilitated by the bank.  Today the United States filed a criminal charge and a civil complaint in the U.S. District Court for the Central District of California.

The criminal information charges the bank with a felony violation of the Bank Secrecy Act in connection with the bank’s relationship with a third-party payment processor.  The civil complaint alleges that CommerceWest Bank knowingly facilitated consumer fraud by permitting the payment processor to make millions of dollars of unauthorized withdrawals from consumer bank accounts on behalf of fraudulent merchants.  To resolve the department’s criminal and civil allegations, CommerceWest Bank has agreed to a total monetary resolution of more than $4.9 million, a deferred prosecution agreement and a permanent injunction that reforms the bank’s practices to prevent such fraud in the future.

“CommerceWest Bank ignored a parade of red flags indicating that a third-party payment processor was defrauding hundreds of thousands of innocent victims,” said Acting Assistant Attorney General Benjamin C. Mizer of the Justice Department’s Civil Division.  “As the civil and criminal actions filed against CommerceWest Bank today demonstrate, we will hold financial institutions accountable when they choose unlawfully to look the other way while fraudsters use the bank’s accounts to steal millions of dollars from American consumers.”

According to the civil complaint, from December 2011 through July 2013, CommerceWest Bank worked with V Internet Corp LLC, a third-party payment processor based in Las Vegas.  V Internet processed transactions for fraudulent merchants that withdrew money from consumers’ bank accounts without authorization.  These merchants included a fraudulent telemarketing company and a company that charged hundreds of thousands of victims for a payday loan referral fee they had never authorized.  In early 2013, V Internet took over the payday loan referral scheme, operating as the payment processor and sole merchant from January 2013 through July 2013.


Attorney General Kamala D. Harris Files Criminal Charges Against Operators of Valley Springs Manor

Filed under: California Defense Attorney — fayarfa @ 6:12 am

LOS ANGELES – Attorney General Kamala D. Harris today announced that Valley Springs Manor owner Herminigilda Noveda Manuel and administrator Edgar Babael were charged on fourteen felony counts of elder abuse for abandoning the residents of their facility.

Manuel and Babael operated Valley Springs Manor, a residential care facility for the elderly that was ordered closed in October 2013 after the Department of Social Services found multiple licensing violations. After the closure, paramedics arrived at the facility and found fourteen residents had been abandoned by the operators with no personnel to tend to their activities of daily living and medical needs. Both defendants are charged with fourteen felony counts and could face up to 17 years in state prison and a fine of up to $6,000 per count.

This case arose from a joint investigation by the California Department of Justice, Bureau of Medi-Cal Fraud and Elder Abuse (BMFEA) and the Alameda County Sheriff’s Office.  Since taking office in 2011, Attorney General Harris has created specialized BMFEA teams in Sacramento and Los Angeles composed of legal and nursing professionals to combat abuse, neglect and poor quality of care in California’s nursing homes.

A copy of the complaint submitted to the court is attached to the online version of this release

Monday, March 9, 2015


Filed under: California Defense Attorney — fayarfa @ 6:10 am

NEWPORT BEACH – An attorney was convicted today of crashing her car into a bicyclist and killing him while driving under the influence of prescription drugs. Hasti Fakhrai-Bayrooti, 41, Rancho Santa Margarita, pleaded guilty today to one felony count of vehicular manslaughter while intoxicated. She faces a maximum sentence of four years in state prison. She is out of custody on $100,000 bail and is scheduled to be sentenced on May 8, 2015, at 8:30 a.m. in Department H-13, Harbor Justice Center, Newport Beach.

At approximately 6:45 p.m. on March 15, 2013, Fakhrai-Bayrooti was driving her car southbound on Santa Margarita Parkway in Mission Viejo after consuming prescription drugs, including Xanax and Suboxone. She swerved into a bike lane, crashing into 54-year-old bicyclist Eric Billings between the intersection of El Toro Road and Los Alisos Boulevard, causing the victim to roll over the hood and windshield. The victim died at the scene as a result of sustaining multiple traumatic injuries from the crash.

The Orange County Sheriff’s Department (OCSD) arrived at the scene and investigated this case. OCSD arrested the defendant on Sept. 23, 2013, after the Orange County Crime Laboratory analyzed the blood evidence.

At the time of the crime, Bayrooti had been an active member of the State Bar of California since 2005.

Deputy District Attorney Stephen Cornwell of the Homicide Unit is prosecuting this case.

Orange County District Attorney / Case # 13HF2830 / March 10, 2015

March 10, 2015

Owner Of Pico Rivera Nightclub Charged By Federal Grand Jury With Laundering Money For Mexican Drug Organization

Filed under: California Defense Attorney — fayarfa @ 3:44 am

LOS ANGELES – The owner of El Rodeo nightclub in Pico Rivera was named today in a federal grand jury indictment that charges him with using his bar and another one he controlled in Moreno Valley to launder drug proceeds on behalf of Mexican drug traffickers.

Edgar De Dios Fragoso, 38, of Hacienda Heights, was named today in an eight-count indictment that charges him with conspiracy to launder money and seven counts of money laundering.

Fragoso was arrested on a criminal complaint that charged him with money laundering on February 23, and he was subsequently freed on a $100,000 bond.

Today’s indictment alleges that Fragoso conspired to launder drug proceeds through the two El Rodeo locations for an unnamed trafficker who imported methamphetamine into the United States. According to court documents, the drug trafficker funneled the cash collected from methamphetamine sales to Fragoso, who  delivered the money to the drug organization under the guise that the payments were for business and financial services.


Justice Department Seeks to Permanently Shut Down California Tax Preparer and Convicted Felon

Filed under: California Defense Attorney — fayarfa @ 3:38 am

The United States has asked a federal court in Sacramento, California, to bar a Ripon, California, man from preparing tax returns for others, the Justice Department announced today.

According to the government’s complaint, Sarad Chand has repeatedly prepared federal tax returns that understate his customers’ federal tax liabilities.

The complaint alleges that Chand, and others working with him under the business name S. Chand Tax & Accounting Services, prepared tax returns that falsely claimed inflated or fabricated tax credits or deductions.  The suit notes that Chand most frequently prepared returns that falsely inflated unreimbursed employee business expenses.  Chand also created Schedule Cs (Profit or Loss From Business) with false income, while for other clients he created false losses or inflated expenses, according to the suit.  According to the complaint, these fabrications served to improperly reduce the customers’ taxable income and resulted in reduced tax liability or inappropriate tax refunds.  Moreover, according to the complaint, Chand also led his customers to believe that he was a former Internal Revenue Service (IRS) employee, when he was not.

The suit also notes that on May 15, 2014, Chand pleaded guilty to aiding and assisting in the preparation and presentation of a false and fraudulent tax return in United States v. Chand, et al., Case No.1:12-CR-00425 (E.D. Cal.).  As part of his plea agreement, Chand agreed to the entry of a permanent civil injunction, according to the complaint.


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