Ezri Namvar, a businessman and philanthropist in the Los Angeles Iranian-Jewish community
Los Angeles real estate investor Ezri Namvar was sentenced to seven years in federal prison on charges related to the theft of more than $20 million from investment clients.
A jury had convicted Namvar on May 19 of wire fraud charges stemming from allegations that he stole from clients who had trusted him to hold proceeds from commercial real estate sales. Namvar's company, Namco Financial Exchange Corp., helped clients avoid paying taxes on real estate sales by holding their money until they used it to make new purchases.
But instead of safeguarding the money as promised, prosecutors said, Namvar used it to make payments to creditors from another company he controlled. When that company failed, Namvar was unable to repay clients from his tax exchange company.
U.S. District Judge Percy Anderson imposed the sentence after hearing testimony from one victim who said the losses had left her unable to pay for physical therapy for a physically handicapped child.
Namvar's attorney, Marc S. Harris, had asked for leniency, arguing that Namvar had informed clients that he would invest their money in his other business and had intended to repay them. But when the real estate and financial markets collapsed in the fall of 2008, Namvar's investments collapsed.
"The loss was not reasonably foreseeable," Harris said in a sentencing memorandum. "Properties that should have sold for hundreds of millions of dollars could not be sold at any price."
He also said that Namvar was a man of good character who had "donated millions of dollars to numerous charities, schools and medical research centers, locally and internationally."
Still unresolved are claims by dozens of investors in Namvar's real estate development business, Namco Capital Group Inc., who say he misappropriated hundreds of millions of dollars. Their claims are being heard in U.S. Bankruptcy Court.
"My clients are happy to see him go to prison, but they hope this is not the end of the investigation by the FBI," said attorney A. David Youssefyeh, who represents investors with claims against Namvar's real estate company. "We're hoping now that this case is over they'll concentrate on the other case and figure out what happened there."