September 23, 2019

Q&A: Youssefyeh sheds light on Namvar criminal and bankruptcy cases

Los Angeles-based attorney A. David Youssefyeh has been insulted, had vicious rumors spread about him and even been verbally threatened by many in his Iranian Jewish community here in Southern California over the past three years for speaking in support of his client—many of whom are also Iranian Jews and victims of an alleged ponzi scheme by the now convicted Iranian Jewish banker, Ezri Namvar. To many of the hundreds of now poverty-stricken Namvar creditors in the community he is considered righteous for helping to bring legal action against Namvar and also being their voice while the community’s leaders have remained silent. For other Namvar creditors, he is seen in a poor light because they believe that they could have regained their investments or parts of their money back from Namvar if attorneys like Youssefyeh had not encouraged their clients to pull Namvar into involuntary bankruptcy. Like him or not, he has been one of the more vocal public voices from Southern California’s Iranian Jewish community regarding the Namvar case in a time when the community’s leadership has largely remained silent on the sidelines while countless families have had to endure tremendous financial hardship.

Last year my webcast interview with Youssefyeh went viral worldwide and his courage to speak up about the plight of Namvar’s victims and start a community dialogue has been applauded by Iranian Jews and others familiar with the case. Youssefyeh sat down with me recently to discuss both Namvar’s recent criminal conviction and more background regarding the bankruptcy case.

What does Namvar’s conviction mean to the victims of Namvar and Namco that have been furious these past two and half years?

They have some relief knowing that Mr. Namvar won’t be able to run around town from one party to another while they are wondering how to pay for their schooling, retirement or even their next meal. One the one hand they are happy to see some justice done. On the other hand the verdict has brought back all of the bitter feelings that they felt when they realized that their money was gone.

Where you surprised at the jury’s quick response in this case?

Not at all. This case was a slam dunk for the prosecution.

You were criticized, attacked and your name was besmirched by many in the Iranian Jewish community for being one of the few people who were vocal against Namvar for his alleged fraud early on. What does the jury verdict mean to you?

Although I see Mr. Namvar’s conviction as a positive step towards justice for his victims, the verdict does not make a difference to me in terms of what I think about the whole affair. At the end of the day, I am confident in the decision that was made by myself and my clients to put Mr. Namvar and his company into bankruptcy as we took every step possible to avoid a bankruptcy. At the end of the day, however, it was Mr. Namvar’s actions that forced our hand. For about a month prior to the filing of the bankruptcy myself and my clients sat with Mr. Namvar, his brothers and “elders of the community” trying to come up with a solution that would avoid a bankruptcy filing but at every turn we found that Mr. Namvar would tell us one thing face to face and do something else the second that we walked out the room. For example, he would promise us that he would cease transfer of his properties but that same day I would get calls from people close to him, or other creditors about Mr. Namvar’s attempts to dispose of his assets. Another good example is the Wilshire-Bundy building. This is the main asset in Mr. Namvar’s bankruptcy estate and the bulk of the payment to the creditors is going to come from the proceeds of this asset. At the time that myself and my clients became involved in the case, Mr. Namvar had the building in escrow scheduled to be sold to a select group of creditors. The proceeds of that sale were going to pay the money that Mr. Namvar had taken from his 1031 exchange customers—even back then he knew he had criminal liability for his 1031 misdeeds.

On multiple occasions prior to the bankruptcy, we asked Mr. Namvar to stop the sale and or to keep the proceeds of the sale within Namco since it was from Namco’s creditors that Mr. Namvar had obtained the money to purchase the building in the first place. Mr. Namvar, however refused to ever consider sending the proceeds anywhere but to his 1031 exchange customers. The icing on the cake was when Mr. Namvar, seeing our determination, began a series of threats against myself and my clients. It was always through third parties as he was never man enough to do it in person. He event sent a group of people to “protest” against the bankruptcy outside one of my client’s residence on Shabbat. Finally the bankruptcy trustees’ report which accused Mr. Namvar of treating Namco as his personal “piggybank” is probably the most damning evidence against him. If after reading that report, you still don’t believe that he was a fraudster, then probably nothing will change your mind.

How do you respond to the critics and even some of the victims of Namvar’s alleged ponzi scheme that argue his conviction is meaningless to them as it will not help them regain their lost savings?

The government can’t force Mr. Namvar to bring back the money that he is hiding overseas, but they can prosecute him for theft of money if he doesn’t bring it back. The reason that we are out over two years from the bankruptcy and Mr. Namvar’s victims are still waiting to be paid is because of Mr. Namvar’s lack of cooperation with the trustees. We still do not have a declaration of assets from him that is signed under the penalty of perjury. I just hope that the verdict causes Mr. Namvar’s brothers to step up to the plate and at least compensate his elderly and poor victims. This will go a long way towards healing the pain in the community.

Only Namvar and his controller Tabatabi were convicted last week. What have you heard from the Namvar/ Namco creditors as far as their desires to see the federal prosecutors pursue criminal charges of conspiracy against the other Namvar family members?

A lot of the creditors had expressed to me their desire to see the federal government investigate the dealings of the entire family because they worked so closely with each other. I know that the bankruptcy trustees have filed multiple lawsuits against members of Mr. Namvar’s close family and companies controlled by them for causes of action that include preference, fraudulent transfer and breach of fiduciary duty. However I don’t know if any of them are being criminally investigated. I’m sure that the trustees are working closely with the FBI to report any illegal practices that they see. If anyone has any information, they should also contact the FBI.

I understand that many of the Iranian Jewish Namvar and Namco creditors have been frustrated with their community’s leadership regarding this case. Can you please shed light on the response or lack of response from the Southern California Iranian Jewish community’s leadership regarding this case?

One of the issues here is that our community has been in America for too long and is too spread out to have one set of leaders. On any given Saturday, there are more Persian Jews praying in “American Synagogues” than in “Persian Synagogues”. Consequently, the Iranian Jewish Federation is not the central hub to go to in times of need. Nevertheless, there has been a lot of frustration by the victims because at a private meeting, Rabbi David Shofet, whom a lot of people in the Iranian Jewish community look up to, expressed that as a matter of rabbinic law, he holds the entire Namvar family liable for the losses caused by Mr. Namvar. Rabbi Shofet, however has refused to affirm the statement publicly and this has caused a lot of frustration for victims that want to use this statement to negotiate with Mr. Namvar’s family. There are also many creditors who are mad at “Chabad of Brentwood” for allowing Mr. Namvar into its synagogue after the scandal hit. At the end of the day, this scandal showed that we need to be organized as a community.

Do you believe Namvar is a flight risk and may leave the country even though he has surrendered his passport? If so, is Iran an option for him to flee to?

I don’t think that he is a flight risk. Where is he going to go? He has money in Israel but they would deport him in he fled to Israel and Iran is such a bad place for Jews—so why he go there?

The Iranian Jewish community has been plagued in recent years with several other similar alleged ponzi schemes and financial fraud cases from individuals similar to Namvar. These individuals have not yet been criminally charged, but what message does Namvar’s conviction send to them and other who may be planning similar schemes?

The message to people that haven’t been charged yet is very clear—you are next! Hopefully Mr. Namvar’s conviction will deter anyone else who is contemplating doing something similar. But the reality of life is that soon enough there will be others.

This case has shattered the trust among individuals in the Iranian Jewish community and its leadership. Is there any hope for a healing and return of that trust anytime soon?

At some point we will move on from this and everyone will move on. But it is going to take a long long time.