United States v. John Farahi

1. In the factual basis supporting the plea agreement, Farahi admitted that he had lied to Newpoint investors about the type and risk level of the instruments he bought with the investors’ money, and that for years he sold unregistered securities to investors without disclosing that he knew he was violating SEC regulations. In addition, there is substantial evidence of the breadth and duration of Farahi’s fraudulent scheme in the record. Accordingly, the district court did not clearly err in finding that over 80 Newpoint investors were victims of Farahi’s criminal conduct and suffered losses of over $22 million. See U.S.S.G. §§ 2Bl.l(b)(l)(L), 2Bl.l(b)(2)(B).

Nor did the district court abuse its discretion when it declined to reduce the loss calculation by the amount of money Farahi returned to investors after his crimes were discovered. Application Note 3(E)(i) to section 2B1.1, on which the district court expressly relied, makes clear that only money returned before the defendant’s offense is detected should be credited against the loss amount.

2. Farahi admits that he knowingly lied to Sun West in order to convince the bank to renew his $2 million credit line. Given that: (1)…