Speaking of judges (and juries), a plugged-in reader delivers the Grand Jury Indictment for Maher Talal Muhawieh.

Beginning at a time unknown to the Grand Jury, but no later than January 2006, and continuing through at least March 2009, MAHER TALAL MUHAWIEH knowingly and intentionally devised a material scheme and artifice to defraud lenders, and to obtain money and property by means of materially false and fraudulent pretenses, representations, promises and omissions.

To execute and in furtherance of the scheme, MUHAWIEH solicited and caused others to solicit at least $25 million from at least 80 prospective lenders based upon (a) promises and representations that the lenders’ funds would be used to purchase and to renovate specific properties in San Francisco, California, that would then be sold at a profit, and (b) promises and representations that MUHAWIEH would thereby achieve regular and high rates of return for the lenders with limited risk.

In truth, MUHAWIEH did not intend to use the lenders’ funds in the manner that he promised and represented to the lenders, and instead misappropriated and converted those funds to his own benefit and the benefit of others without the knowledge and authorization of the lenders. In fact, and contrary to his promises and representations to lenders, MUHAWIEH instead used the lenders’ funds to pay interest on loans from other lenders, for personal expenses and to invest in retail businesses located in San Francisco, California.

Of course he did purchase (and bid up the value of) a few homes in San Francisco too.
Calling All Contractors That Still Have Cash… [SocketSite]
United States of America v Maher Talal Muhawieh [justice.gov]
Two More Muhawieh Comps Of Yore Head For The Courthouse Steps [SocketSite]
Another Muhawieh 2007 Noe Comp Heads For The Courthouse Steps [SocketSite]

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Comments from “Plugged-In” Readers

  1. Posted by Jimmy (No Longer Bitter)

    That guy is about to get a much-deserved kick in the ass from the US Attorney!!

  2. Posted by EBGuy

    I wonder how many members of his community gave depositions? There are a couple of individuals who loaned him $1+million. I don’t think I covered this lawsuit yet:
    THE COURT ORDERED THE FOLLOWING JUDGMENT ENTERED: IT IS ADJUDGED THAT PLAINTIFF BATSHON, NAJIB DEEB RECOVER FROM DEFENDANT MUHAWIEH, MAHER AN INDIVIDUAL $1,720,000.00 PRINCIPAL, $24,000.00 ATTORNEY FEES, $302,295.79 INTEREST, $1,763.68 COSTS, TOTAL JUDGMENT $2,048,059.47

  3. Posted by lolcat_94123

    Good thing he bought before he was priced out forever.

  4. Posted by Rillion

    Classic ponzi scheme promise: “MUHAWIEH would thereby achieve regular and high rates of return for the lenders with limited risk.”
    Classic ponzi scheme result: “MUHAWIEH instead used the lenders’ funds to pay interest on loans from other lenders, for personal expenses”
    Assuming these charges are true…

  5. Posted by Brian

    What kind of prison is he going to go to?
    http://www.youtube.com/watch?v=xPcql4FuCK0

  6. Posted by MossySF

    Shrug…sounds like a lottery tax for the rich. Greedy rich folks have been falling for ponzi schemes since time immortal.

  7. Posted by Skirunman

    Ponzi schemes effect the poor as well. Here are some stats in general: http://www.law.com/jsp/article.jsp?id=1202437299784
    My understanding on Muhawieh was that most investors were relatives of one kind or another and were not “rich”.

  8. Posted by sfrenegade

    “My understanding on Muhawieh was that most investors were relatives of one kind or another and were not “rich”.”
    My understanding from friends in this community is pretty close to Skirunman’s. As I understand, many of the folks were cousins, cousins of friends, etc. Everyone’s a “cousin.” 🙂
    Most of the investors were likely not “rich,” but rather were very good savers and modest small business owners (i.e. not “small business owners” like Congress talks about small business owners but actual small businesses). Although something very similar happened, the demographic here is not anywhere close to Madoff, to pick one example.

  9. Posted by tc_sf

    “Maher Talal Muhawieh pleaded guilty in federal court in San Francisco yesterday to wire fraud, United States Attorney Melinda Haag announced.
    In pleading guilty, Muhawieh admitted that he defrauded investors between approximately January 2006 and March 2009 by promising various individuals that their funds would be used to purchase and to renovate specific residential properties in San Francisco that would then be sold at a profit. Muhawieh claimed he would make regular and high rates of return for the lenders with limited risk. In fact, and contrary to Muhawieh’s promises, he used investors’ funds to pay interest on loans from other investors, and for personal expenses.”
    http://www.justice.gov/usao/can/press/2011/2011_10_06_muhawieh.guiltyplea.press.html

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