An Irvine-based financial services company’s chief executive was arrested Thursday on federal charges of ripping off at least 11 victims, many of whom were retired, in an alleged scam that promised big returns on investments that actually went into the pockets of three defendants involved in the scheme, police said.
Memet Fatih Biyikoglu, 50, of Palm Desert, the CEO of Five Star Financial Services of America, was expected to be arraigned Thursday afternoon in a Santa Ana federal courtroom.
Co-defendant Anna Marie Holt, 58, of Fountain Valley, the company’s president and chief operating officer, was expected to surrender to authorities Thursday, according to Thom Mrozek of the U.S. Attorney’s Office. Holt was also expected to be arraigned Thursday, he added.
Co-defendant Ida Shaghoian, 38, of Palm Desert, who was a sales agent for the company and was previously married to Biyikoglu, was at-large, Mrozek said. She may be in Las Vegas, he added.
One victim, a 66-year-old retiree, who “was grieving her husband’s recent death and was in financial distress,” invested in Five Star with a promise of a “high rate of return,” according to an affidavit supporting the charges filed in court. She invested $45,871.63.
Another victim, who was 70, was promised his investment would double in a year, so he invested $1.6 million and has only gotten $20,000 back, according to the affidavit.
Biyikoglu spent investor money “for personal expenses, including for jewelry, real estate, and sports cars, including a Ferrari,” according to prosecutors.
Shaghoian spent investor money on “jewelry, clothing, home improvements, and European luxury vehicles,” according to prosecutors.
Investigators estimated that the 11 victims invested at least $4 million from 2014 through 2015, according to prosecutors. Several lost all of their retirement money, prosecutors allege.
They could face up to 20 years in federal prison if convicted of conspiracy to commit wire fraud, prosecutors said.