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LOS ANGELES – $5 Million Wire Fraud Scheme Exposed
LOS ANGELES – Two former executives of iPayment, Inc., a payment processor based in Westlake Village, have agreed to plead guilty to participating in a scheme that stole more than $5 million from the company. Robert Torino, 63, of Norwell, Massachusetts, who was the chief operating officer of iPayment, and Nasir Shakouri, 40, of Westlake Village, who was the company’s senior vice president of sales and marketing, each agreed to plead guilty to federal charges of conspiracy to commit wire fraud.
Torino and Shakouri agreed to plead guilty in plea agreements that were filed this morning in United States District Court. Both defendants have agreed to appear in court and be arraigned on April 14. The United States Securities and Exchange Commission filed a civil action against Torino, Shakouri and others at the same time as the plea agreements and related charging document.
iPayment primarily processes credit and debit transactions for small merchants, many of whom are recruited to use iPayment’s services by agents or independent sales offices. Pursuant to contractual obligations, iPayment sometimes paid sales offices a portion of the fees it collected from the merchants recruited by the sales offices, as well as bonuses and referral fees collectively known as residuals.
As part of the criminal conspiracy, Torino, Shakouri and others created fictitious sales offices to unlawfully divert to themselves and others residuals which had been purchased by iPayment as part of a residual buy out. A second part of the conspiracy involved theft from iPayment through a kickback scheme involving two vendors that provided information technology services to iPayment.
“These defendants used their considerable inside knowledge of their employer’s business practices to skim over $5 million from iPayment’s bottom line,” said United States Attorney Eileen M. Decker. “The stolen money should have gone to the company and its owner.”
Once they plead guilty, Torino and Shakouri will each face a statutory maximum penalty of five years in federal prison. The investigation into Torino and Shakouri was conducted by the Federal Bureau of Investigation and IRS Criminal Investigation. The case is being prosecuted by Assistant United States Attorneys Monica Tait and Jill Feeney of the Major Frauds Section.
Key Facts
- State: California
- Category: Fraud & Financial Crimes
- Source: DOJ Press Release â†â€â€
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