Man arrested in $2.4-million embezzlement at Santa Ana bakery
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An Orange County man was arrested Thursday and charged in a $2.4-million embezzlement and money laundering scheme involving the fraudulent purchase of a commercial bakery and the sale of bakery equipment, prosecutors said.
Mehrdad Shah Mohammad Tabrizi, 54, has been charged with one felony count of grand theft, three felony counts of using untrue statements in the purchase and sale of a security and 11 felony counts of money laundering, with various sentencing enhancements, according to a statement from the Orange County district attorney’s office.
Tabrizi, a resident of Aliso Viejo, is being held in lieu of $2.4-million bail and must prove the money is from a legal and legitimate source before posting bond, prosecutors said. He is set to be arraigned Friday.
In 2008, prosecutors said, Tabrizi is accused of entering an agreement to purchase a Santa Ana commercial bakery that supplies baked goods to retail establishments. Prosecutors said he agreed to pay $25,000 per month toward the $2.4-million purchase price, in addition to $30,000 per month for leasing the building and land.
The purchase price included $2.1 million in bakery equipment, and as part of the agreement, Tabrizi was supposed to maintain the equipment until the $2.4 million was paid in full, prosecutors said.
But immediately after reaching the agreement, prosecutors said, Tabrizi defaulted on the purchase and lease payments, and fraudulently accessed the company’s $85,000 line of credit without authorization.
He is also accused of canceling the company’s existing contracts with retail establishments and terminating employees, according to prosecutors.
The bakery equipment was either sold or damaged beyond repair, prosecutors said. The original owner sued Tabrizi in June 2009 to regain possession of the bakery.
Between June and August 2009, prosecutors said, Tabrizi met with three separate investors under the pretense of being the outright owner of the company and the equipment. He allegedly offered the investment contracts to them, failing to disclose the multiple civil judgments against him and that he was in default for the purchase of the bakery and the lease.
Prosecutors said that Tabrizi took $300,000 from investors and provided them with promissory notes and checks dated three months in the future in the amount of their original investment plus a 20% return, and that he also spent the money and never returned it to the victims. In February 2010, the original owner of the Coast to Coast bakery regained possession. One of the victims in the case hired a private investigator, who alerted Orange County prosecutors.
-- Rick Rojas