Former Democratic fundraiser Hassan Nemazee was sentenced to 12 years in prison Thursday for his involvement in a decade-long bank fraud scheme involving three major banks and more than $292 million, according to a news release from the U.S. Attorney’s office in the Southern District of New York.
U.S. District Judge Sidney Stein also ordered Nemazee to pay more than $292 million in restitution to the banks, serve three years supervised release and forfeit properties, corporate entities, hedge funds, securities and bank accounts.
He pled guilty to defrauding the banks in March.
According to the release, Nemazee used bogus documents and fake account statements to convince Bank of America, Citibank and HSBC Bank to give him hundreds of millions of dollars worth of loans.
The documents also displayed forged signatures and fake phone numbers from individuals associated with Westminster Securities Corporation — where Nemazee claimed to hold assets — and its clearing firm, Pershing LLC. In fact, Nemazee had set up “virtual offices” or cell phone lines for the phone numbers, forging an intricate façade to his multi-million dollar fraud scheme.
In August 2009, Nemazee owed about $142 million to Bank of America and $74.9 million to Citibank, according to the release. He frequently used credit from one bank to pay off the other.
That same month, Citibank finally questioned the existence of the extensive collateral Nemazee had used to obtain loans, launching an FBI investigation.
Nemazee used the scheme to finance a Park Avenue apartment, buy land and an apartment in Italy, upkeep a 12-acre property in Katonah, N.Y., and make personal donations to the election campaigns of federal, state and local political candidates.
He also used the scheme to bolster his reputation and political standing.
Nemazee served as Finance Chairman in Hillary Clinton’s 2008 presidential campaign and donated heavily to Democratic candidates.
In 1999, he was nominated to become U.S. Ambassador to Argentina, but the nomination was later withdrawn. Nemazee also unsuccessfully sought nomination to a cabinet-level position 10 years later — all while operating the scheme.
U.S. Attorney for the Southern District of New York Preet Bharara called Nemazee’s scheme a “fantastic fiction” and praised the sentence.