Fraud

A Newport Beach-based business owner faces up to 47 years in federal prison after pleading guilty Friday to bilking investors out of more than $15 million in a Ponzi scheme, federal officials said. John Miller, 51, of San Clemente, pleaded guilty in a Los Angeles federal courtroom Friday to bribery, passport fraud, identity fraud and mail fraud related to his scheme. According to prosecutors, this is how his scheme worked: Between 2000 and November 2008 Miller ran JAM Jr. Enterprises and Forte Financial Partners.

Authorities seized a local firm’s records, and at least one employee faces arrest after Costa Mesa detectives and Orange County district attorney fraud investigators served an Anton Boulevard business with a search warrant Wednesday. Authorities searched Dinh & Associates PC, at 575 Anton Blvd., across the street from South Coast Plaza. Detectives and prosecuting investigators carried out boxes of files and electronics Wednesday morning as potential evidence in their criminal investigation.

A Newport Beach business owner has been sentenced to 10 years in prison for scamming corporations out of millions of dollars through fake workers’ compensation insurance policies. Mitchell Zogob, 51, of San Juan Capistrano, pleaded guilty Thursday to multiple counts of grand theft, fraud embezzlement and forgery as part of a plea agreement with prosecutors. Between 2002 and 2003, Zogob, who owned Professional Employers Assurance Group and Program Administrators Inc., both on Birch Street, sold more than $4.6 million in fake insurance policies.

A Newport Beach stockbroker was sentenced Monday in United States District Court to four years in prison for defrauding clients of nearly $3 million, according to the U.S. Attorney's office. Richard O'Leary, 56, will begin serving his prison term Feb. 6. He was also ordered to pay $2.9 million in restitution to more than two dozen victims, officials in the U.S. Attorney's office said. O'Leary pleaded guilty in February to three counts of wire fraud, admitting that he placed client funds into bogus investments and took the money.

Deirdre Newman Two offices and a residence were raided today by a swarm of federal agents investigating a trio that includes a Newport Beach couple. The investigation of Lorenzo Espinoza, his wife Cynthia Espinoza and their associate Pedro Rodriguez involves a host of alleged crimes. They include conspiracy to engage in fraud, attempting to defraud the IRS and attempting to launder money. IRS, FBI and Department of Housing and Urban Development agents are all involved in the investigation.

BRIEFLY IN THE NEWS Costa Mesa man charged with fraud Federal authorities in Los Angeles have charged five people, including a 34-year-old Costa Mesa man, with wire fraud for allegedly helping people obtain loans insured by the Federal Housing Administration, officials said Wednesday. The U.S. attorney's office has also charged 13 people of obtaining more than $10 million in fraudulent loans insured by the U.S. Department of Housing and Urban Development, officials said.

A San Clemente man who operated a Ponzi scheme out of his Newport Beach-based company was sentenced to 13 years and three months in federal prison, federal officials announced Tuesday. John Anthony Miller, 52, was sentenced Monday after pleading guilty last year to mail fraud, bribery, passport fraud and identity fraud charges related to the Ponzi scheme he operated through his companies, JAM Jr. Enterprises and Forte Financial Partners. From 2000 through 2008, Miller ripped off more than 130 people out of more than $21 million, officials said.

U.S. Sen. Dianne Feinstein plans to introduce a resolution in September calling on the abolition of the Electoral College and, instead, electing the president through popular vote. Where do you stand on this issue and why?   Abolishing the Electoral College is a bad idea because our Founding Fathers put that system in place with good purpose. When elections are close, they didn’t want the tendency for fraud to overwhelm the system. If the Electoral College had been eliminated during the 2000 election, all of the illegitimate brouhaha in Florida would have been multiplied by 50 states.

AREA 1 Harbor Boulevard: Battery was reported in the 2100 block at 12:39 p.m. Tuesday. Placentia Avenue: Grand theft was reported in the 2300 block at 10:06 a.m. Tuesday. AREA 2 16th Place: Fraud was reported in the 400 block at 2:34 p.m. Tuesday. Adams Avenue: A vehicle was reported stolen in the 1200 block at 12:27 a.m. Tuesday. East 17th Street: A vehicle was reported stolen in the 300 block at 2:35 a.m. Tuesday.

An Orange County judge sentenced two sisters to eight and 10 years in prison, respectively, for their part in a conspiracy with two other members of their family to commit $16 million worth of real estate fraud, prosecutors said Monday. Suniti Shah, 51, and Supriti Soni, 52, falsified documents to secure loans for "straw buyers" — or people who allow their credit to be used with no intention of controlling a property, according to the Orange County district attorney's office. The last known addresses were in Newport Coast for Shah and Corona del Mar for Soni, according to D.A. spokeswoman Farrah Emami.

A Los Angeles man arrested at South Coast Plaza in August has been convicted of stealing credit cards from the elderly. Doren Harold Ward, 37, was convicted last week of six felonies, including charges of aggravated identity theft, bank fraud and credit card fraud, according to the federal Department of Justice and Costa Mesa police. He faces a maximum sentence of 104 years in federal prison. The aggravated identity theft charge carries a two-year, mandatory sentence, federal authorities said.

An Irvine securities lawyer who authorities said teamed with an insurance agent to bilk scores of investors out of more than $20 million has been sentenced to seven years in federal prison. Jeanne Rowzee, 53, and 65-year-old James Halstead, who already is in prison, solicited tens of millions of dollars from individual investors who ran the gamut from wealthy developers to retirees on fixed incomes. The pair promised to put the money into securities known as private investment in public equity, or PIPEs, which they said would return as much as much as 35% in as little as three months, prosecutors said.

Editor's Note: This is the first in a series on the Real Estate Fraud Advisory Board and the Orange County District Attorney's fraud unit. * If you're in real estate and you're in Elizabeth Henderson's sites, you are probably on the wrong side of the law and you should know there's a whole community of real estate experts helping her try to catch and punish you. Henderson, an assistant district attorney and head of the major fraud unit in the Orange County District Attorney's office, has behind her the Real Estate Fraud Advisory Board.

Two Newport Coast residents pleaded guilty Thursday morning to bank fraud in connection with seven different financial institutions. Thomas Chia Fu, 63, and his wife, Cheri L. Shyu, 60, gained a revolving line of credit from multiple banks, including Bank of America, in the amount of $130 million by falsifying their business revenue for Anaheim-based Galleria USA, according to a news release from the U.S. Department of Justice. The banks lost about $4.7 million because of the fraud between 2008 and 2009.

A former Newport Beach attorney who was convicted last year in an investment fraud case has been sentenced to 70 months in prison. Gerald M. Shaw was indicted in 2007 on federal fraud and money laundering charges for a scheme in which he and another man allegedly took millions of dollars from victims who were promised rates of return as high as 40% a week. In addition to the 70-month sentence, Shaw was ordered to pay $4.3 million in restitution. Prosecutors said Shaw and Gregory De Lavalette of Rancho Santa Fe, who allegedly worked for Shaw, solicited investments from people by falsely stating that the money would be used to trade European bank instruments.

A Newport Beach man who pleaded guilty to federal charges of wire fraud is expected to be sentenced before the year's end, authorities said. Gerald M. Shaw was found in a hospital by federal authorities this week after he failed to appear in court for his sentencing Monday and a bench warrant was issued for his arrest, said U.S. Attorney spokesman Thom Mrozek. Shaw is accused of soliciting investments, sometimes from his clients, with the promise of trading European bank instruments and instead using the money for business and personal expenses, according to an FBI news release.

A Costa Mesa woman who pleaded guilty to 76 felonies, including forgery and grand theft in a scheme to defraud banks, was sentenced Friday to jail time and formal probation, authorities said. While working as a desk manager at the Douglas Nissan dealership in Orange, Luz Belem Corral, 29, submitted falsified Kelly Blue Book records overstating the value of cars in an effort to defraud banks. Prosecutors said was assisted by colleague Kevin Allen DeRosier, 31, of Anaheim, and part-owner Frank Ignacio Urbano, 57, of Anaheim, according to an Orange County district attorney's office news release.

Authorities are looking for victims of an alleged fraud scheme that promised investors returns on money given to sponsor trips to China and Taiwan for prominent politicians. Irvine resident Kuei Fuang Tsuei Hu, 62, and her son Jack Hu, 26, were arrested in October and charged with three counts of wire fraud. Jack Hu was also charged with misusing the U.S. seal, according to an FBI news release. The two are accused of defrauding customers by telling them their money was being invested in Jack Hu's company, London International Group, to sponsor visits to China for former presidents George W. Bush and Bill Clinton or to send former Vice President Al Gore to Taiwan.