Federal prosecutors have unsealed an updated indictment charging a dozen defendants in a scheme to buy millions of dollars’ worth of electronics from a national retailer by using fraudulently acquired discounts and employee identification numbers, the U.S. Department of Justice announced Thursday.
The 54-count grand jury indictment unsealed Wednesday in Los Angeles federal court charges the defendants, variously, with multiple felonies, including conspiracy, mail fraud, wire fraud and bank fraud, and aggravated identity theft.
Four of the 12 suspects — including alleged ringleader Abdallah Osseily, 34, of Irvine — were arrested Wednesday by special agents of the FBI, and three were arraigned the same day and ordered released on bond. A fourth defendant was arrested in Arizona on Wednesday and made his initial court appearance in Phoenix federal court.
Osseily was ordered to return to Los Angeles federal court on Oct. 1 for a motions hearing. The indictment’s remaining eight defendants are expected to appear in court at a later date.
Prosecutors allege that from July 2014 to last March, Osseily and co-defendants acting at his direction, unlawfully purchased millions of dollars’ worth of electronics from an unidentified company, referred to in court papers as U.S. Retailer 1. These purchases were undertaken 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 the retailer’s return policies to obtain store credits in amounts greater than the prices they actually paid for the merchandise, according to the DOJ.
The defendants traveled to hundreds of the chain store’s locations across the country on purchasing trips and shipped the merchandise back to Osseily’s Irvine home or — in one case of 500 pounds of electronic goods — to Los Angeles International Airport, the indictment alleges.
Osseily then allegedly resold the merchandise to third parties and underreported his profits to the IRS, federal prosecutors said.
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.