Dem Fundraiser Indicted for $290M Bank Scheme

September 22, 2009

(ChattahBox)—New York financier Hassan Nemazee, lived a jet-setting life of wealth and luxury for a over a decade, extravagantly contributing to political campaigns and charities and purchasing villas in Italy. But his wealthy lifestyle was exposed this week as an elaborate fraud, when Nemazee was indicted for defrauding three banks of $290 million in a major swindling scheme.

Hassan Nemazee, 59, was first arrested on August 25, for defrauding Citibank, using fake documents to show he had sufficient collateral to take out a loan. But it was soon discovered that Nemazee’s fraud involved two additional banks, and he juggled all three in an elaborate scheme before he was finally caught.

His scheme was simple, but effective. Nemazee would use money from one fraudulently obtained loan to pay off money owed to a different bank and so on, until the scheme finally came crashing down after 10 years. Prosecutors are calling the bank fraud a Ponzi scheme.

The indictment alleges that from 1998-2009, Nemazee defrauded Citibank, Bank of America and HSBC Bank USA for hundreds of millions of dollars, using fake documents to secure loans. He still owes $142 million to Bank of America and nearly $75 million to Citibank.

When investigators began to unravel the scheme in August, Nemazee drew down on a line of credit fraudulently obtained from HSBC and used that money to pay off the $74.9 million loan to Citibank, according to the prosecutor’s office.

Portions of the fraudulently obtained monies were used to contribute to political candidates and PACs.

Nemazee is charged with three counts of bank fraud, each charge carrying a maximum prison term of 30 years and a fine of one million dollars, or twice the gain or loss resulting from the crime. His assets will also be subject to forfeiture, including five properties, 16 businesses, a hedge fund, 32 bank accounts, a 2008 Maserati Quattroporte sports car, and a 2007 Cessna aircraft.

The Democratic National Committee, Obama for America, and the Presidential Inaugural Committee, plan to donate the $61,700 received from Nemazee to charity.

Nemazee was Hillary Clinton’s finance chair during her 2008 presidential run.



One Response to “Dem Fundraiser Indicted for $290M Bank Scheme”

  1. ajay kumar sharma on September 23rd, 2009 4:06 pm

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