A former Los Angeles County Sheriff’s Department deputy pleaded guilty Monday to federal conspiracy charges for helping a now-jailed crypto mogul extort a rival and arrange the sham arrest of another of the businessman’s adversaries.
Michael Coberg, 44, of Eastvale in the Inland Empire, pleaded guilty in downtown Los Angeles to conspiracy to commit extortion and conspiracy against rights.
Prosecutors said Coberg and three other ex-LASD deputies worked side hustles as private security for the Southern California cryptocurrency trader who referred to himself as a “Godfather.”
That man, Adam Iza, 25, a Beverly Hills and Newport Beach businessman, pleaded guilty in January to charges of conspiracy against rights, wire fraud and tax evasion and is awaiting sentencing in December.
Prosecutors said Coberg’s contract with Iza allowed the then-lawman to work as a business partner and adviser in addition to security. Iza paid Coberg at least $20,000 per month for his services, federal prosecutors said.
According to the U.S. Attorney’s Office, the extortion scheme developed when Coberg and others picked up a victim whose business partner was having a financial dispute with Iza. After taking the victim to Iza’s home, Iza placed a firearm on the desk and displayed an assault rifle, which was placed on the ground near the desk, authorities said.
Coberg then told the victim that he was an active-duty law enforcement officer and interrogated the victim about the financial dispute Iza had with the business partner. While Coberg stood watch over the victim, Iza demanded — and recorded a video of — the victim transferring $127,000 to a bank account Iza controlled. Iza then directed his security guards to seize the victim’s passport and told them to drive the victim back to the victim’s hotel, prosecutors said.
The next day, Coberg continued to interrogate the victim about the financial dispute and the location of the victim’s business partner. Later that day, Coberg took Iza and the victim to a shooting range in Iza’s home and left the two alone. Iza then held the victim at gunpoint and demanded the victim’s business partner transfer money to him — which the victim’s business partner did later that day, court papers filed in L.A. federal court show.
In a false traffic stop and arrest scenario, Coberg conspired with Iza and others to lure another victim from Miami to Los Angeles to set up the victim and cause him to be arrested with illegal narcotics, prosecutors say.
During the previous month, Coberg learned of a dispute between Iza and the victim and that Iza and two corrupt LASD deputies working for Iza forced the victim at gunpoint to transfer $25,000 from the victim’s bank account to an account Iza controlled.
Coberg and other co-conspirators set up a plan in which the victim’s ex-girlfriend called the victim and pretended to be interested in pursuing a romantic relationship to convince the victim to fly to Los Angeles to meet with her to use drugs together, according to court documents.
With Coberg’s advice and counseling, the co-conspirator purchased the airplane ticket for the victim, picked him up at Los Angeles International Airport in a white Tesla, drove the victim to obtain drugs, and later traveled to a location in Paramount where an LASD deputy would make the traffic stop and arrest.
Ex-LASD Deputy Christopher Cadman, 33, of Fullerton, admitted participating in the intimidation of the victim in August 2021 resulting in the $25,000 payment to Iza and also helped set up the false arrest. Cadman pleaded guilty in August to federal criminal charges and awaits sentencing in January.
With Cadman’s assistance, Coberg lied to a fellow LASD deputy that a confidential informant was driving a white Tesla with an individual who had an outstanding arrest warrant and possessed illegal drugs. That deputy later conducted the traffic stop, searched the Tesla, found cocaine in the car and psilocybin mushrooms inside the victim’s backpack, and arrested the victim, according to the U.S. Attorney’s Office.
During the arrest, Coberg slowly drove past the scene in a black Cadillac Escalade SUV — with the window rolled down — as Iza watched from the back passenger seat. Iza took videos and photographs of the victim’s arrest, authorities said.
After the arrest, Coberg texted Cadman to thank him for facilitating the traffic stop and stated, “the kid enjoyed it,” referencing Iza. Iza later taunted the victim by sending him a photograph of the victim’s arrest in progress and the victim’s booking photo, and texting him that as “a drug dealer, you … with the wrong people.”
U.S. District Judge Percy Anderson scheduled a Feb. 17 sentencing hearing, at which time Coberg will face up to 30 years in federal prison, prosecutors noted.