Los Angeles, California - Federal prosecutors have unsealed a superseding indictment charging a dozen defendants in an illegal scheme to buy millions of dollars’ worth of electronics from a national retailer by using fraudulently acquired discounts and employee identification numbers, the Justice Department announced Thursday.
The 54-count grand jury indictment unsealed Wednesday charges the defendants, variously, with multiple felonies, including conspiracy, mail fraud, wire fraud and bank fraud, and aggravated identity theft.
Four of the 12 defendants – including lead defendant, Abdallah Osseily, 34, of Irvine – were arrested Wednesday by special agents of the FBI. Three of the defendants were arraigned Wednesday afternoon in United States District Court in Santa Ana and were ordered released on bond. A fourth defendant was arrested in Arizona on Wednesday and he made his initial court appearance in Phoenix federal court. An October 13 trial date has been set for this case.
The indictment’s remaining eight defendants are expected to appear in federal court at a later date.
The indictment alleges that, from July 2014 to March 2020, Osseily and co-conspirators acting at his direction, unlawfully purchased millions of dollars’ worth of electronics from a company, referred to in the indictment as “U.S. Retailer 1.” These illegal actions were taken through the unauthorized use of discounts and unique identification numbers, such as those reserved for current and former employees and for military service members, the indictment alleges. In other instances, the defendants allegedly exploited U.S. Retailer 1’s return policies to obtain store credits in amounts greater than the prices they actually paid for the merchandise.
The defendants traveled to hundreds of U.S. Retailer 1 locations across the country on purchasing trips and shipped the merchandise back to Osseily’s Irvine residence or – in one case of 500 pounds of electronic goods – to Los Angeles International Airport. Osseily then resold the merchandise to third parties and underreported his profits to the IRS, according to the indictment.
The new indictment replaces an indictment filed in June 2019 that charged only Osseily with bank fraud and attempted bank fraud, attempted unlawful procurement of naturalization, and making a false statement in an immigration proceeding.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
If convicted of all charges, Osseily would face a statutory maximum sentence of more than 100 years in federal prison.
The FBI’s Joint Terrorism Task Force and IRS Criminal Investigation investigated this matter.
This case is being prosecuted by Assistant United States Attorneys Annamartine Salick, Chief of the Terrorism and Export Crimes Section; Matthew J. Jacobs, also of the Terrorism and Export Crimes Section; and Daniel G. Boyle of the Asset Forfeiture Section.
