| March 19
March 19 A former Los Angeles-area radio talk
show host was sentenced to 10 years in prison after he pleaded
guilty to running a $24.4 million fraud involving fake
securities linked to the federal Troubled Asset Relief Program,
U.S. authorities said on Tuesday.
John Farahi, 56, who also operated Beverly Hills-based New
Point Financial Services Inc, is the second securities industry
professional sentenced to prison for selling investments in fake
TARP-backed securities, according to a statement from Christy
Romero, special inspector general for the Office of the Special
Inspector General for the Troubled Asset Relief Program
Farahi's prison term matches that imposed in 2009 on Gordon
Grigg, a financial adviser and owner of ProTrust Management Inc
in Franklin, Tennessee, SIGTARP said.
TARP is the federal bailout program established during the
recent global financial crisis.
According to SIGTARP, Farahi admitted to bilking investors
by promising to buy TARP-backed corporate bonds and admitted to
conspiring with his lawyer to obstruct a U.S. Securities and
Exchange Commission probe.
It said Farahi used money obtained from investors, including
many in Los Angeles' Iranian-Jewish community, and borrowed from
banks that received TARP infusions to repay earlier investors in
a Ponzi-like fashion.
SIGTARP said Farahi lived luxuriously, with a Beverly Hills
mansion, a yacht and three expensive cars - a Bentley, a Ferrari
and a Rolls Royce.
"Exploiting the TARP bailout for personal gain is
reprehensible," Romero said.
In imposing the sentence on Monday, U.S. District Judge
Philip Gutierrez in Los Angeles also ordered Farahi to repay
$24.4 million to 59 victims, according to SIGTARP.
David Hurwitz, a lawyer for Farahi, did not immediately
respond to requests for comment.
Farahi, of Bel Air Estates, California, pleaded guilty last
June 7. He once had a regular show on KIRN-AM radio.
David Tamman, 46, a former partner at the law firm Nixon
Peabody, had been found guilty last November in a trial before
Gutierrez for helping Farahi obstruct the SEC probe.
The California State Bar last month suspended Tamman from
practicing law. Tamman's sentencing is scheduled for May 20.
David Duncan, a lawyer for Tamman, declined to comment.
The case is U.S. v. Farahi et al, U.S. District Court,
Central District of California, No. 11-cr-01165.
(Reporting by Jonathan Stempel in New York; Editing by Leslie