Dearborn man pleads guilty to $2 million investment

A Dearborn man pleaded guilty in federal court today to running a $2 million investment fraud scheme that swindled money from numerous investors who thought their money was being used for legitimate reasons, including rebuilding efforts in Iraq. Ahmed Alabadi, 45, a dual citizen of Iraq and the U.S. pleaded guilty to wire fraud involving multiple victims. Authorities said he sought investments in his company, Fedek Group, Inc., by promising that investors would earn a substantial return, sometimes of up to 100% within one year. He also told them that their money would be safe or guaranteed, and that it would be used for, among other things, rebuilding efforts in Iraq and to fulfill contracts that his company had with the United Nations and various foreign countries. In reality, authorities said, the money was not used for legitimate reasons. Instead, money collected from later investors was used to pay earlier investors in a Ponzi scheme fashion. Many investors never received their initial investment back. “The victims of this scheme were under the impression they were making legitimate investments around the world but were in fact being swindled out of large sums of money," said Special Agent in Charge Brian Moskowitz of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations. Added U.S. Attorney Barbara McQuade: “Investment fraud is just a sophisticated way of stealing people’s money, but it sometimes leads to the financial ruin of victims.” Under his plea agreement, Alabadi agreed to pay $2.3 million in restitution to his victims. Under his sentencing guidelines, he faces between 51 and 63 months in prison. He will be sentenced Oct. 4 before U.S. District Judge Denise Page Hood. Authorities hope Alabi’s case sends a message to other investors. “Alabadi stole over $2 million by misleading everyday working class citizens. Schemes designed to defraud innocent investors are violations of federal law and the consequences of such schemes can and will result in jail time." said Special Agent in Charge of the IRS Criminal Investigation Erick Martinez. original source: http://www.freep.com/article/20120628/NEWS02/120628092/Dearborn-man-pleads-guilty-2-million-investment-fraud