Man pleads guilty to $2M investment fraud

By SHERRI KOLADE
Times-Herald Newspapers

DEARBORN — A Dearborn man is scheduled for sentencing before a United States District Court judge Oct. 4 for his part in a $2 million investment fraud scheme.

Ahmed Alabadi, 45, pleaded guilty in federal court June 28 for his role in the scheme, U.S. Attorney Barbara L. McQuade announced.

He will be sentenced by U.S. District Court Judge Denise Page Hood.

Alabadi pleaded guilty to wire fraud involving multiple victims. He was charged with one count of attempted bank fraud, three counts of wire fraud and one count of money laundering, according to a press release.

Alabadi, a dual citizen of Iraq and the United States, sought investments in his company, Fedek Group Inc., by promising that investors would earn a substantial return, sometimes of up to 100 percent within one year, and that the money invested would be safe or guaranteed, according to the United States Attorney’s Office Eastern District of Michigan press release.

Alabadi told investors that their money would be used to support Iraq rebuilding efforts for real estate transactions and an export/import business, and to fulfill contracts that his company had with the United Nations and other foreign countries, none of which ever happened.

Alabadi did not deliver the returns that he promised to give to investors, and many investors never received their principal investment back after their period of investment expired, according to the release.

Money collected from investors was not used for legitimate rebuilding or business activities and the money collected from later investors was used to pay earlier investors in a type of Ponzi scheme, according to the release.

As part of his plea agreement, Alabadi agreed to pay restitution of $2.35 million to the defrauded investors, according to the release.

Alabadi faces a sentence of up to 20 years in prison.

The suggested range for his sentence within federal sentencing guidelines is 51 to 63 months imprisonment, according to the release.

McQuade said investment fraud is a “sophisticated way of stealing people’s money.”

“But it sometimes leads to the financial ruin of victims,” McQuade said.

Involved in the case were Special Agent in Charge Edward Hanko of the Federal Bureau of Investigation, Special Agent in Charge Brian Moskowitz of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, and Special Agent in Charge Erick Martinez of the Internal Revenue Service – Criminal Investigation.

Moskowitz said the victims of the scheme were under the impression they were making legitimate investments around the world.

“They were, in fact, being swindled out of large sums of money,” Moskowitz said. “HSI special agents will continue to aggressively investigate those who seek to profit by taking advantage of others.”

The case is being prosecuted by Assistant U.S. Attorney Louis P. Gabel.

(Sherri Kolade can be reached at skolade@bewickpublications.com.)

Tags: