Indian-American Jailed For Fraudulent Schemes

May 19, 2017 10:08
Indian-American Jailed For Fraudulent Schemes

An Indian-American man has been jailed for 15 years for duping over the 100 investors of $33 million through the fraudulent schemes.

44-year-old Navin Shankar Subramaniam Xavier, a resident of Florida, was a former CEO of the Essex Holdings, a company through which he carried out two fraud schemes. On Thursday, Xavier was sentenced to 15 years in prison by the US district judge Darrin Gayles in Miami.

The first fraudulent scheme involved nearly 100 investors who purchased $30 million worth of the promissory notes purportedly secured by interests in the iron ore mining in Chile.

The second fraudulent scheme was engaged in unlawfully obtaining $1.2 million in the form of economic development funds and also the valuable industrial property from the state of South Carolina.

Xavier was convicted on the guilty plea in the month of January on two counts of the wire fraud. One wire fraud count is connected to the investment fraud scheme and the other wire count is connected to the South Carolina economic development scheme.

As per the documents filed in court, from September 2010 to May 2014, Xavier operated the Essex Holdings from the office in Miami and also he raised more than $30 million from nearly 100 investors for the supposed investments in sugar transportation and shipping, as well as on iron ore mining in Chile.

He used the false financial statements, forged documents and also false promises of fixed rates of return, to induce the people to invest in company. Most of the money, which he obtained was used for the purposes other than what was promised, including to support the lavish spending by Xavier and also his wife for expensive jewellery, luxury vehicles, wedding expenses, and also cosmetic surgery.

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Eventually, Xavier used the new investors money to pay the old investors in a Ponzi-like fashion before the scheme was collapsed.

Evidence filed in the court showed that the actual investor losses from the fraudulent scheme exceeded $29 million.

The second fraudulent scheme was engaged Xavier in using the Essex Holdings to obtain $1.2 million in the form of payments and also approximately $1.5 million worth of the commercial real estate from the South Carolina Coordinating Council for Economic Development (SCCCED), a part of the South Carolina state government, that was supposed to be used to develop a dilapidated industrial property into a diaper plant and also rice packaging facility.

As per documents filed in the court, Xavier provided false financial documentation to the SCCCED in order to obtain the contract, and later he provided the fake contractor invoices and also fake bank statements in order to get paid under the contract. In connection with the investment fraud scheme, Xavier spent a major portion of the development money to meet his personal expenses, and also wired some of the money to the same overseas accounts which were used in the investment fraud.

Mrudula Duddempudi.

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