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Joseph Zada Indictment

Joseph Zada Indictment

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Published by SJDunn1956

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Published by: SJDunn1956 on Sep 10, 2013
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sep 4, 2013
UNITED STATES DISTRICT COURT
SOUTHERN DISTRIG OF FLORIDA tYX7*qITItQI.
s .D. 0F #t.A. . MGMt3-80173-CR-MAR MATTHEWMAN
CASE NO.
18 U.S.C. j134118 U.S.C. j134318 U.S.C. 91957
18 U.S.C. j2314
UMTED STATES OF AMERICA,
VK
JOSEPH PAUL ZADA,
Defendant.
/
INDICTGNTThe Czrand Jul charges that:
COUNTS 1-21MAIL FRAUD1. From at least as early as in or about January 1998, through in or about August 2009, atPalm Beach County, in the Southem District of Florida, and elsewhere, the defendnnt,JOSEPH PAUL ZADA,did knowingly and with intent to defraud, devise and intend to devise a scheme and artifke to
degaud and forobtaining money and property by means of materially false and fraudulent pretenses,
representations and promises, knowing that the pretenses, representations and promises were falsewhen made.
PURPOSE AND OBJECT OF THE SCHEG TO DEFRAUD
2. It was the purpose and object of the scheme and artifice to defraud for the defendant to
Case 9:13-cr-80173-KAM Document 1 Entered on FLSD Docket 09/04/2013 Page 1 of 12
 
unlawfully enrich himself by misappropriatingmoney from investors forhispersonal use andbenefk
by making materially false representations, and omitting to state material facts, concerning nmong
other things, the use of investors' funds and the profitability of the investments made through thedefendant.
SCHEME AND ARTIFICE TO DEFRAUD
The manner and means by which the defendant sought to accomplish the objects of the
fraudulent scheme and artifce included, among others, the following:
3. In order to attract investors to his fraudulent scheme, the defendant projected an image
of great wealth, portraying himself as a successful businessman and investor with colmections toSaudi Arabian oil ventures. In this regard, the defendant hosted extravagant parties, drove expensive
luxury vehicles, and maintained expensive homes in Wellington, Florida and Grosse Pointe,
Michigan. Unbeknownst to the investors, the defendant used investors' money primarilyto fund this
lavish lifestyle.4. The defendant often solicited investment money from trusting associates who lived or
worked near the defendant or were associated with other investors already invested. The defendantrepresented to investors that the offered investments would result in large profits within a shortperiod of time. The defendant provided little specifics regarding these investments, other thanrepresenting that investor funds were being invested in oil ventures. lnstead, the defendant toldinvestors that there was a tûwindow of opportunity'' and the investors would have to decide whether
to invest money quickly. While soliciting money, the defendant told investors elaborate cover stories
to justify the lack of verifiable infonuation regarding the proposed investments. For example, the
defendant stated that he was being groomed to replace his mentor who was purportedly a member
Case 9:13-cr-80173-KAM Document 1 Entered on FLSD Docket 09/04/2013 Page 2 of 12
 
of a secret board of diredors that controlled billions of dollars in investments, or that the defendantwas a board member of a company that bought and sold oil. In essence, the defendant representedto investors that only he could directly invest in the oil ventlzres tluough his board positions and
connections. The defendant also told investors that their money would be pooled with his money toreceive better rates and a larger share of the profits.5. As result of the defendant's false representations and omissions of facts, investors wiretransferred monies and/or sent checks to the defendant with the understanding that he would use thefunds to invest in various oil ventures on their behalf.Thereafter, investors usually receivedpromissory notes reflecting the principal nmount of their investment. The defendant told investors
that he would consider their investments as loans, and provided promissory notes regarding their
initial investments. The defendant never provided to investors any other documents, such as account
statements.
6. Investor monies were deposited into bank accounts maintained by the defendant.
Thereafter, instead of being used to invest in oil ventures, the investor monies were withdrawn fromthose accounts and used to support the defendant's lavish lifestyle and to make purported returns oninvestments to prior investors.7. Occasionally, investor S.F. also loaned the defendant money because the defendantclaimed he had cmsh flow problems. However, S.F. would not have lent the defendant money had
the defendant disclosed to him that the defendant had not previously invested S.F.'S money in oi1
related ventures.8. From in or around Janualy 1998, through in or around April 2009, the defendant caused
over twenty investors to invest over $20 million based on materially false statements and omissions
Case 9:13-cr-80173-KAM Document 1 Entered on FLSD Docket 09/04/2013 Page 3 of 12

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