Complaint of Bank Fraud Filed Against Businessman

The U.S. Postal Service filed a criminal complaint of bank fraud Friday in U.S. District Court in Los Angeles against former Orange County businessman Jose Manuel de la Jara as part of a broader investigation into what state and federal officials claim is one of the biggest scams ever to focus on local Latino investors.

De la Jara, 44, is under investigation by local, state and federal authorities for allegedly bilking $8.2 million from about 1,400 Latino investors in Southern California. Investigators charge that De la Jara’s now-defunct company, American Investment and Finance Group in Santa Ana, was nothing more than a scam.

Advertisements on Spanish-language television and radio programs featured De la Jara promising a 22% return on real estate and gemstone investments. The state Department of Corporations, which is selling off his estate, claims that De la Jara was operating a so-called Ponzi scheme: paying off old investors with funds from new clients.

A federal grand jury is hearing evidence in the case.

Assistant U.S. Atty. Carolyn Kubota said the case “is clearly one of the most significant fraud schemes we are aware of” in the Latino community. “What is so aggravating about this,” she said, “is that a lot of the victims were working-class people who scraped together their life savings and then lost them.”

The Postal Service’s complaint stems from $800,000 in loans De la Jara obtained from Mission Viejo National Bank in 1989 under allegedly false pretenses. Investigators say De la Jara sought the loans to keep American Investment in business.

The complaint was filed in order to continue De la Jara’s incarceration at Metropolitan Detention Center, where he is being held pending the conclusion of a separate money-laundering trial in federal court in Los Angeles. Authorities can use a complaint to keep someone in jail for up to 10 days while an indictment is sought.

The jury in De la Jara’s money-laundering case began deliberations Friday after a two-week trial. De la Jara is facing 12 counts of money laundering and related charges. The prosecution claims he laundered about $250,000 in drug money. If convicted, he could be sentenced to up to 120 years in jail.

During closing arguments in the case Friday, Assistant U.S. Atty. Karin Immergut described how De la Jara allegedly laundered the money. She said that he and an assistant spent four days in 1987 driving to different banks throughout Southern California, depositing a total of $126,000 in transactions of less than $10,000 each.

This was done, she said, to circumvent federal laws that require financial institutions to report cash transactions of more than $10,000.