Los Angeles/ Crime & Emergencies
AI Assisted Icon
Published on May 23, 2024
Orange County Business Owner Indicted for Alleged COVID-19 Relief Fraud and Tax EvasionSource: LA Court

An Orange County man is facing charges for allegedly gaming COVID-19 relief efforts and tax evasion, engaging in wire fraud, and money laundering, the feds say. Mehrdad "Mitch" Tabrizi, the owner of multiple Southern California-based transportation companies, was indicted by a federal grand jury after being accused of concocting fraudulent claims to scoop up nearly $700,000 from federal relief programs intended to help those hit by the pandemic's economic impact.

According to the superseding indictment, Tabrizi is alleged to have submitted two fraudulent Paycheck Protection Program (PPP) applications, claiming his Riverside business, Life Fleet Inc., had a significant number of employees and substantial monthly payroll expenses. Despite receiving the PPP funds, it's claimed he used them to cover personal costs. The charges, as described in a report released by the Department of Justice, also detail similar accusations involving an erroneous application to the Economic Injury Disaster Loan (EIDL) program, where he purported Life Fleet had over $4 million in gross revenues and 63 employees, which was not the case.

Adding to his list of alleged deceit, the grand jury claimed that Tabrizi also filed a fraudulent EIDL application for another one of his companies, Resonante Group Inc., based in Anaheim. This application falsely stated the company boasted over $19 million in gross revenues and employed more than 300 staff, leading to a disbursement of roughly $319,800, which he again is accused of diverting for personal use. These developments follow previous charges against Tabrizi, including tax evasion and filing false tax returns.

Further digging into his financial maneuvers, the indictment asserts, Tabrizi deliberately did not disclose about $2.6 million of income to his CPA firm for tax preparation, alleging instead these funds were received by another business. If convicted of his slew of charges, he could face up to 20 years in prison for each count of wire fraud, among other substantial penalties. As stated by the U.S. Attorney's Office, these allegations and the subsequent trial underscore the government's continued effort to crack down on those exploiting federal aid programs.

While an indictment is not a conviction, and Tabrizi is presumed innocent until proven guilty, the case, now in the hands of IRS Criminal Investigation, will proceed to the courts where a federal district judge will determine the sentence based on the U.S. Sentencing Guidelines and other factors. The case is being prosecuted by Assistant U.S. Attorney Brett A. Sagel of the Corporate and Securities Fraud Strike Force along with Trial Attorneys Christopher E. Lin and Boris Bourget from the Justice Department's Tax Division.