FBI agents arrested a Century City man for allegedly running a multimillion-dollar Ponzi scheme that primarily targeted the Persian-Jewish community in Los Angeles, according to the U.S. attorney’s office.
Shervin Neman, whose given name is Shervin Davatgarzadeh, 31, was indicted on two counts of wire fraud and one count of mail fraud. He was taken into custody Friday morning. His victims allegedly lost more than $3 million, according to a news release from the U.S. attorney in Los Angeles.
The charges carry a maximum of 20 years in prison.
Federal prosecutors say than Neman claimed to be a successful investor while actually running the Ponzi scheme from the summer of 2010 to June of 2012. He solicited money from investors “with false claims that their money would be used to purchase foreclosed real estate and stocks, including pre-initial public offering shares,” the press release said. Instead, prosecutors say he just took the money for himself or repaid earlier victims.
The Securities and Exchange Commission filed a civil complaint against Neman and his firm, Neman Financial Inc., in April 2012. A month later, he allegedly solicited $2 million from another investor to pay his lawyers in that case and pay back his earlier victims, whom he had write emails saying that he no longer owed them money. Neman used these e-mails as part of his defense in the SEC case.
In June of 2012, Neman sent the latest victim a check for $2,235,800 as a return on a supposed Facebook investment. The check bounced, according to the U.S. attorney’s office
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