In a shocking case of embezzlement, a former auditor at a commercial real estate agency in Newport Beach has pleaded guilty to stealing over $2.7 million from his employer. Varun Aggarwal, 41, used his position in the internal auditing department to submit fictitious invoices for companies controlled by his family and friends, who never provided any services. He then redirected the payments from these invoices into his own bank accounts, disguising the transactions through approved vendors. Aggarwal’s fraudulent scheme went undetected for several years until the company initiated an investigation into the suspicious invoices. The former auditor faces a maximum sentence of 20 years in federal prison and is scheduled for sentencing in January 2024. The case was investigated by the FBI and is being prosecuted by Assistant United States Attorney Brett A. Sagel.
Former Auditor Pleads Guilty to Embezzling $2.7 Million
Varun Aggarwal’s Guilty Plea
In a significant case of financial fraud, former auditor Varun Aggarwal pleaded guilty to embezzling more than $2.7 million from his employer. Aggarwal, a former executive at an Orange County commercial real estate agency, admitted to submitting fictitious invoices for companies controlled by his family and friends, who never provided any services. This guilty plea marks the culmination of an extensive investigation by the Federal Bureau of Investigation (FBI) into Aggarwal’s fraudulent activities.
Details of the Embezzlement
According to Aggarwal’s plea agreement, he worked in the internal auditing department of Newport Beach-based KBS Realty Advisors from 2008 to January 2022. Over the course of several years, Aggarwal used his position and knowledge of KBS’s policies and procedures to orchestrate the embezzlement scheme. He exploited his familiarity with the payment process to have his friends and family approved as vendors and submit fraudulent invoices for consulting services that were never rendered.
Aggarwal successfully funneled approximately $2,729,718 from KBS to his personal bank accounts through these approved vendors. By manipulating the invoice and payment system, Aggarwal deceitfully obtained a significant amount of money from his employer.
Aggarwal’s Method of Embezzlement
Aggarwal leveraged his position in the internal auditing department to exploit KBS’s payment policies and procedures. He facilitated the approval of his relatives and friends as vendors, allowing them to submit fraudulent invoices for consulting services. Aggarwal ensured that the payments on these invoices were directed to his personal bank accounts, bypassing the vendors who were unaware that the payments were ultimately benefiting Aggarwal.
His careful manipulation of the system allowed him to embezzle millions of dollars over several years without detection. Aggarwal’s actions demonstrate a significant breach of trust and a sophisticated understanding of financial processes.
Amount Embezzled
Aggarwal’s embezzlement scheme resulted in the misappropriation of approximately $2.7 million from his employer, KBS Realty Advisors. This substantial amount emphasizes the severity of Aggarwal’s crime and the detrimental impact it had on the company’s finances.
Resignation from KBS
As KBS began investigating the suspicious invoices, Aggarwal chose to resign from his position in January 2022. His resignation came after years of successfully embezzling funds from the company and maintaining his position as the director of the internal auditing department. Aggarwal’s departure marked the end of his illicit activities and the beginning of a thorough investigation into the extent of his fraudulent actions.
Sentencing Hearing Scheduled
United States District Judge Cormac J. Carney has scheduled a sentencing hearing for Varun Aggarwal on January 22, 2024. Aggarwal faces a maximum sentence of 20 years in federal prison for wire fraud, the charge to which he pleaded guilty. This hearing will mark an essential stage in the legal proceedings against Aggarwal and will determine the severity of his punishment.
Investigation by the FBI
The Federal Bureau of Investigation played a crucial role in uncovering Varun Aggarwal’s embezzlement scheme. The FBI conducted an extensive investigation, gathering evidence and building a case against Aggarwal. Their thorough work allowed for the successful prosecution of this complex financial fraud case.
Prosecution of the Case
Assistant United States Attorney Brett A. Sagel, from the Santa Ana Branch Office, is responsible for prosecuting Varun Aggarwal’s case. Sagel will present the evidence gathered by the FBI and argue for a significant penalty that reflects the severity of Aggarwal’s actions. The prosecution aims to secure justice for KBS Realty Advisors and send a message about the consequences of financial fraud.
Contact Information
For further information regarding Varun Aggarwal’s embezzlement case, please contact Ciaran McEvoy, the Public Information Officer, at ciaran.mcevoy@usdoj.gov or by phone at (213)-894-4465. The United States Department of Justice is committed to transparency and is available to provide the public with updates and details about this case.
Related Financial Fraud Cases
Varun Aggarwal’s guilty plea is just one among many cases of financial fraud that have been prosecuted in recent years. The prevalence of white-collar crimes, including embezzlement and fraud, underscores the importance of effective oversight and robust internal controls in both public and private organizations. The prosecution of these cases sends a strong message that financial malfeasance will not be tolerated, and those who engage in such activities will be held accountable for their actions. It serves as a reminder of the need for constant vigilance in detecting and preventing financial crimes.