A venture capitalist and political fundraiser was sentenced today to 144 months in federal prison for falsifying records to conceal his work as a foreign agent while lobbying high-level U.S. government officials, evading the payment of millions of dollars in taxes, making illegal campaign contributions, and obstructing a federal investigation into the source of donations to a presidential inauguration committee.
Imaad Shah Zuberi, 50, of Arcadia, California, was sentenced by U.S. District Judge Virginia A. Phillips, who also ordered him to pay $15,705,080 in restitution and a criminal fine of $1.75 million.
In November 2019, Zuberi pleaded guilty to a three-count information charging him with violating the Foreign Agents Registration Act (FARA) by making false statements on a FARA filing, tax evasion, and making illegal campaign contributions. In June 2020, Zuberi pleaded guilty in a separate case to one count of obstruction of justice. His sentence today pertains to both cases.
“Zuberi turned acting as an unregistered foreign agent into a business enterprise,” said Assistant Attorney General for National Security John C. Demers. “He used foreign money to fund illegal campaign contributions that bought him political influence, and used that influence to lobby U.S. officials for policy changes on behalf of numerous foreign principals. He not only concealed his lucrative agreements with those foreign principals, but also made false statements about them in a FARA filing. After learning he was under investigation, Zuberi doubled down on his criminal conduct, obstructing justice by creating false records, destroying evidence, and attempting to purchase witnesses’ silence. This sentence should deter others who would seek to corrupt our political processes and compromise our institutions in exchange for foreign cash.”
“Mr. Zuberi flouted federal laws that restrict foreign influences upon our government and prohibit injecting foreign money into our political campaigns. He enriched himself by defrauding his clients and evading the payment of taxes,” said Acting U.S. Attorney Tracy L. Wilkison for the Central District of California. “Today’s sentence, which also accounts for Mr. Zuberi’s attempt to obstruct an investigation into his felonious conduct, underscores the importance of our ongoing efforts to maintain transparency in U.S. elections and policy-making processes.”
“As Mr. Zuberi’s greed and wealth increased, his elaborate influence-peddling scheme collapsed,” said Assistant Director in Charge Kristi K. Johnson of the FBI’s Los Angeles Field Office. “By lending a veneer of credibility through name dropping and flashing photos with high-level government officials, Zuberi was able to con foreign donors. Now that he’s been sentenced, he will be held accountable by the United States government which he so recklessly misrepresented.”
“Through myriad international contacts and business partners, Imaad Shah Zuberi was able to raise money and gain influence among the U.S.’s highest political circles. Zuberi used his status to solicit funds for lobbying, campaign contributions, and investments, but ultimately swindled his business partners and pocketed most of the funds for himself,” said Special Agent in Charge Ryan Korner of IRS-Criminal Investigation Los Angeles Field Office. “An opportunist at his core, Zuberi worked with political figures across the aisle, depending on who was in power, to lend an appearance of credibility to his political charades. At the end of the day, IRS Criminal Investigation worked closely with our partner federal agencies to ensure Zuberi’s criminal behavior would not pay off, and that he was held accountable for paying himself rather than using the funds he solicited for their original intended purpose.”
Zuberi operated Avenue Ventures LLC, a San Francisco-based venture capital firm, and solicited foreign nationals and representatives of foreign governments with claims he could use his contacts in Washington, D.C., to change U.S. foreign policy and create business opportunities for his clients and himself.
Clients gave Zuberi money for consulting fees, to make investments, or to fund campaign contributions. As part of his efforts to influence public policy, Zuberi hired lobbyists, retained public relations professionals, and made campaign contributions that gave him access to high-level U.S. officials, some of whom acted in support of his clients. As evidence of his access and influence, Zuberi distributed to his clients photographs of himself discussing policy with elected officials.
While Zuberi had a limited degree of success with some U.S. officials, most of his business efforts failed and his clients suffered significant financial losses. Many of the lobbyists, public relations consultants, and other subcontractors also suffered losses when Zuberi refused to pay them. Meanwhile, Zuberi became wealthy, largely through his theft of client funds and unlawful lobbying on behalf of foreign interests.
For example, Zuberi made efforts to convince the government of Bahrain to lift sanctions on a Bahraini citizen in order to allow the citizen to develop a large resort in that country. The scheme falsely created the appearance that Avenue Ventures had made a major investment in the resort project. Citing this purported investment, Zuberi lobbied members of Congress to apply political pressure on Bahrain to cease its interference in the project, claiming that it was adversely affecting him as a U.S. investor. At Zuberi’s urging, at least a dozen members of Congress sent letters to the government of Bahrain requesting that it stop interfering with the project. In fact, however, Zuberi designed these efforts to benefit the Bahraini citizen, who paid Zuberi consulting fees. Zuberi violated FARA by failing to register as an agent of the Bahraini citizen in connection with this scheme.
Zuberi also siphoned money invested in U.S. Cares, a company set up to export humanitarian aid to Iran. In 2013 and 2014, investors deposited approximately $7 million into U.S. Cares, but Zuberi used more than 90 percent of investor funds for his personal benefit, which included purchasing real estate, paying down debt such as mortgages and credit card bills, remodeling properties, investing in brokerage accounts, and donating $250,000 to a non-profit organization established by a former high-ranking elected official.
In addition, the government of Sri Lanka hired Zuberi in 2014 to rehabilitate the country’s image in the United States, which had suffered because of allegations that its minority Tamil population had been persecuted. Zuberi promised to make substantial expenditures on lobbying efforts, legal expenses, and media buys, which prompted Sri Lanka to agree to pay Zuberi a total of $8.5 million over the course of six months in 2014. Days after Sri Lanka made an initial payment of $3.5 million, Zuberi transferred $1.6 million into his personal brokerage accounts and used another $1.5 million to purchase real estate.
In total, Sri Lanka wired $6.5 million pursuant to the contract, and Zuberi used more than $5.65 million of that money to the benefit of himself and his wife. Zuberi paid less than $850,000 to lobbyists, public relations firms and law firms, and refused to pay certain subcontractors based on false claims that Sri Lanka had not provided sufficient funds to pay invoices.
Relatedly, Zuberi failed to report on his 2014 tax return millions of dollars in income he received from the Sri Lankan government. While his 2014 federal income tax return claimed income of $558,233, Zuberi failed to report more than $5.65 million he received in relation to the Sri Lanka lobbying effort. Zuberi’s tax evasion over the course of four years – 2012 through 2015 – caused tax losses ranging from $3.5 million to as much as $9.5 million.
Zuberi also violated the Federal Election Campaign Act in 2015 by making conduit contributions in the names of other people, reimbursing contributions made by others, and being reimbursed for contributions he made. Over a five-year period – 2012 through 2016 – he made or solicited more than $250,000 in illegal campaign contributions.
The obstruction charge to which Zuberi pleaded guilty in June 2020 stemmed from a federal investigation into a $900,000 donation from Zuberi through his company to a presidential inaugural committee in late 2016. Some of the funds Zuberi donated to the committee came from other people, including one individual who gave him a $50,000 check.
After media reports that a federal grand jury in the Southern District of New York was investigating donations to the presidential inaugural committee, Zuberi met with the individual at a California restaurant on Feb. 25, 2019. During that meeting, the individual asked Zuberi to refund the $50,000, which Zuberi did, but backdated the check to Feb. 1, 2019, to make it appear the refund was sent before he learned of the federal investigation.
This matter was investigated by the FBI and IRS-Criminal Investigation.
This case was prosecuted by Assistant U.S. Attorneys Daniel J. O’Brien and Elisa Fernandez of the Public Corruption and Civil Rights Section, Assistant U.S. Attorney Judith A. Heinz of the National Security Division, and Trial Attorney Evan N. Turgeon of the Justice Department’s National Security Division, Counterintelligence and Export Control Section.
originally published at Law - NORLY NEWS