Montrose Man Arrested on Wire Fraud Charge

 In blog, Crime – MyNewsLA.com

Montrose Man Arrested on Wire Fraud Charge

by Contributing Editor

A Montrose man pleaded not guilty Monday to a federal charge of defrauding investors out of more than $1 million via an adult entertainment website scam.

Patrick Khalafian, 51, was arrested Friday on a single-count federal grand jury indictment charging him with wire fraud, according to the U.S. Department of Justice. After entering his plea, a Dec. 15 trial date was set, and he was ordered released on $50,000 bond.

If convicted, Khalafian would face up to 20 years in federal prison, prosecutors said.

The indictment alleges that, from November 2009 to October 2016, Khalafian solicited investments for businesses — including 168 Entertainment LLC, Empire Entertainment Group Inc., and EEG LLC — that purportedly developed and operated adult entertainment websites.

Khalafian allegedly represented that victims’ investments would be used for business operations, including developing software and the platform for the proposed websites, paying for servers, hiring employees and purchasing advertising. He also promised that victims’ investments would be repaid by a certain date, according to the indictment filed in Los Angeles federal court.

Instead, Khalafian allegedly used the victim investors’ funds on gambling, luxury shopping sprees, and to pay back other investors. Khalafian allegedly lied about the status of the adult entertainment websites and eventually stopped responding to victims, disconnected his phone number and changed his email address.

In July 2015, Khalafian received $1 million of ill-gotten gains wired from a victim’s bank account in Canada to a bank account he controlled in Woodland Hills, according to the indictment. Prosecutors believe that amount comprises about half of the money Khalafian allegedly raised via the scheme.

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All credit goes to Contributing Editor
Originally published on https://mynewsla.com

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