By James DeWeese
A former Queens resident pleaded guilty earlier this month to charges stemming from his involvement in a fraud ring that used fake corporations to bilk computer and car companies out of $2 million, the Queens district attorney announced March 8.
The guilty plea came after Rami Hassan, 24, formerly of 21-19 76th St. in East Elmhurst, led law enforcement authorities on an 18-month international manhunt that ended with his arrest in Bogota, Colombia, the DA said.
Hassan pleaded guilty to attempted enterprise corruption charges and to bail jumping on an unrelated weapons charge on March 5, Queens DA Richard Brown said.
Hassan was scheduled to appear before State Supreme Court Justice Arthur Cooperman in Kew Gardens April 1 for sentencing. He faces four to eight years in prison.
Hassan, a naturalized American citizen from Kuwait, had been under investigation since March 2000 for his involvement in what the Queens district attorney referred to as the Khan fraud organization, which used identity information that it purchased from Pakistani immigrants to file fraudulent business documents and obtain lines of credit for fake companies.
Based in Queens and Nassau counties, the Khan organization, whose other indicted members are mostly Pakistani in origin, used the credit lines to obtain $1.7 million in computers from companies including IBM, Gateway, Dell, Apple and Sony under corporate lease or purchase programs and then sold the equipment at a discount price to legitimate retailers, Brown said. The fradulently purchased and leased cars (shouldn;t this be computers?) had a total value of about $300,000.
According to the DA, the computer companies turned to Dun and Bradstreet Corp., a major credit rating agency, to conduct background checks on the fake companies. As part of the investigation, Dun and Bradstreet contacted references provided by the defendants, who would then pose as officials from those references so the agency would not uncover negative information, Brown said.
Although she was not specifically familiar with the Khan fraud case, Sandi Gensey, an analyst with Dun and Bradstreet, said the agency investigates companies by using resources of their own and from third parties, including corporate charter records, business licenses and payment information from related vendors.
And “if there’s somebody that doesn’t look on the up-and-up, we would investigate further,” she said. But once Dun and Bradstreet hands over its report, it is up to clients to apply their own criteria when deciding to offer credit or not, she said.
The retailers who purchased the discounted equipment from the fraud ring cooperated fully with the investigation as part of the grand jury proceedings and were not under investigation, said a spokeswoman for the DA. The retailers “thought they were legit,” Navas said, indicating that the companies followed normal business procedures, such as using checks, to make the purchases.
According to the charges? (criminal complaint?), the fraud ring also used the fraudulent credit lines, which it defaulted on, to purchase luxury cars.
To avoid prosecution, Brown said, Hassan fled the country 18 months ago, leading local, state, federal and international law enforcement officials on an international manhunt through Baltimore, Mexico, Belgium, England, Spain, Jordan and Colombia.
Colombian police arrested Hassan April 24, 2003, in Medellin, Colombia, after an American federal agent downloaded a May 2002 press release from the Internet that contained information about the 140-count indictment handed down that same month, Brown said.
While pleading guilty, Hassan also forfeited ownership of $20,000 that police discovered in his apartment during the investigation.
A total of 16 members of the Khan Organization have been charged, the DA said. Six others have been arrested, all of whom have pleaded guilty to charges such as grand larceny, attempted enterprise corruption and falsely completing business records, according to Brown. Two have been sentenced so far.
Investigators believe the remaining nine fugitives have fled to their countries of origin, the DA’s spokeswoman said. Although Hassan was arrested by Colombian narcotics enforcement officials, Navas said that as of right now the Queens DA does not believe the Khan Organization had any ties to the drug trade or terrorist activities.
Reach reporter James DeWeese by e-mail at news@timesledger.com or call 718-229-0300, Ext. 157.
