A Marin County property developer awaiting trial in a state insurance fraud case has been indicted in a federal money laundering and bank fraud investigation, authorities said Thursday.
Bijan Madjlessi, 58, of Strawberry was one of four suspects arrested Wednesday by federal agents. The others are David Lonich, a 59-year-old Santa Rosa lawyer, and two former executives at Sonoma Valley Bank, Sean Cutting, a 44-year-old Sonoma resident, and Brian Melland, a 45-year-old Santa Rosa resident.
The charges involved a real estate project in Santa Rosa called Park Lane Villas East. Authorities allege that Madjlessi defaulted on a $30 million loan on the project, then conspired with the others to repurchase his own defaulted loan and regain the property by using a straw borrower.
"Cutting and Melland failed to disclose their knowledge of the true identities of the borrowers to Sonoma Valley Bank and took steps to authorize the loan," the U.S. attorney's office in San Francisco announced Thursday morning.
The straw borrower obtained the loan from Sonoma Valley Bank and purchased the defaulted loan from a Federal Deposit Insurance Corporation contractor, the government said. Madjlessi and Lonich were then able to obtain the title to the Park Lane Villas East project.
The indictment lists 29 counts that could carry decades in prison and millions of dollars in fines.
All four men were indicted on 22 counts that include wire fraud, bank fraud, conspiracy, and money laundering.
Madjlessi and Lonich were also charged with making false bank entries and attempted obstruction of justice. Cutting faces additional charges of conspiracy to misapply bank funds and making false bank entries. Melland faces an additional charge of conspiracy to misapply bank funds.
The defendants made an initial appearance in federal court in San Francisco, where they were released on $250,000 bonds. The next hearing is April 18.
Madjlessi is still facing trial in Marin Superior Court in a state insurance fraud case. Authorities allege he defrauded $1.4 million from two insurance companies by filing redundant claims after a fire at a Reno condo development in 2008.
The case is scheduled to go to trial on Oct. 28, said Deputy District Attorney Thomas McCallister.
Contact Gary Klien via email at email@example.com
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