A resident of Spain is scheduled to make his first court appearance this afternoon after being extradited to the United States to face a 10-count indictment that alleges he and a female confederate operated a Ponzi scheme that defrauded approximately 150 victims out of $5.8 million.
Ali A. Yawar, a 51-year-old citizen of Afghanistan, is scheduled to make his initial court appearance at 2:00 p.m. in United States District Court in Santa Ana. Yawar arrived in the United States Friday after being extradited from Germany. Yawar was arrested September 18, 2003 at the Frankfurt airport while traveling to Singapore.
Yawar’s codefendant, Sylvia A. Hermann, 61, of San Bernardino, was arrested in March 2003 pursuant to a criminal complaint, and she remains in custody without bond. United States District Judge Gary L. Taylor, who is presiding over the case, has scheduled a June 1 trial date.
The indictment, which was returned by a federal grand jury in Santa Ana in April 2003, alleges that Yawar and Hermann fraudulently collected more than $5.8 million from investors who were told that their money would be invested by Yawar in a “high-yield” investment program in Europe. Between 1998 and June 2000, when the scheme was in operation, investors were promised monthly rates of return of at least 40 percent and as much as 75 percent. Investors were also promised the return of their principal at the end of one year.
Once an investor sent funds to Hermann’s California bank accounts or to Yawar’s Spanish bank account, Hermann and Yawar allegedly caused one or more monthly payments consistent with the promised rate of return to be sent to some of the investors, leading investors to believe that the “high-yield” investment program was legitimate.
The appearance of legitimacy caused many of the investors to invest additional money into the program. In reality, the money used to make the monthly payments primarily came from the investors’ own capital or money received from other investors, not income from any investment. The indictment alleges that Hermann and Yawar were running a classic Ponzi scheme.
The indictment alleges seven counts of wire fraud, each of which carries a maximum possible sentence of five years in prison. In addition, Hermann is charged with nine counts of money laundering, and Yawar is named in three money laundering counts. The maximum sentence for each count of money laundering is 20 years.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty.
This case is the product of an extensive investigation by the Federal Bureau of Investigation and IRS-Criminal Investigation.