A man is in custody on suspicion of defrauding several computer distributors of millions of dollars' worth of computer parts and equipment, then sending his profits to his native Pakistan, Fullerton police said Friday.
According to Fullerton Police Sgt. Mike Maynard, Naveed Hameed, 31, owner of a computer store in Fullerton, paid for the merchandise with checks that he stopped payment on immediately afterward. He then sold the parts to computer buffs and wholesalers "at cheap prices," Maynard said.
Maynard said Hameed put the profits in two accounts with Bank of America, then transferred the money by wire to a bank in his native Pakistan.
Police said Hameed may have defrauded from six to 30 distributors--most from Orange and Los Angeles counties--of between $2 million and $3 million, police said.
In the past two weeks Hameed purchased "somewhere in the neighborhood of $2.5-million worth of parts and equipment, and he has wired close to $1 million to a (Pakistani) bank account," Maynard said.
That sort of scheme is known in business circles as a "bust-out," and its outcome leaves victims reeling because the plotter usually disappears, according to police. Bust-outs are a problem in the computer industry, said experts, who cited a similar case two months ago in Corona in which computer distributors lost $2 million to people who later disappeared.
Hameed, who lives in Anaheim Hills, was arrested Thursday afternoon at his business, Micro America Inc., 1009 N. Placentia Ave. Eleven other people, most of them employees, were detained for questioning but later released, Maynard said. None of them was involved in the scheme, Maynard said.
Hameed was arrested just hours before he apparently was to fly to Pakistan with more than $1 million in cash, Maynard said.
Hameed is being held without bail at the Fullerton City Jail pending arraignment next Tuesday on grand theft and stolen property charges.
Police recovered about $1 million worth of parts and equipment at Hameed's place of business and at his home, Maynard said.