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California based Indian entrepreneur fraud $5 Million, faces 100 years in Prison

LOS ANGELES: Downtown, Los Angeles, California based Indian entrepreneur Khemraj ‘Dave’ Hardat, who fraud investors out of $5 million by claiming to have ties to basketball stars Shaquille O’Neal and Stephen Curry and former PepsiCo CEO Indra Nooyi pleaded guilty to five charges of wire fraud.

Khemraj ‘Dave’ Hardat, from the Ritz Carlton in downtown Los Angeles, California will be sentenced by U.S. District Judge Dale Fischer.

Hardat, who has been living in the U.S. on an expired visitor’s visa, faces a maximum sentence of 100 years in federal prison. The 50-year-old is currently being held at the Los Angeles Metropolitan Detention Center.

In his guilty plea, Hardat admitted that for four years, he falsely represented himself as an investor in the performance beverage and water bottling industry. He told investors that O’Neal, a basketball Hall of Famer, was one of his business partners. He also claimed falsely that Curry of the Golden State Warriors would be endorsing one of his company’s products, according to a statement released by the Justice Department.

He told potential investors he had a Ph.D. and maintained close ties to Nooyi, who is Indian American, as well as computer entrepreneur Michael Dell. He claimed that PepsiCo and Dr. Pepper Snapple Group owed him $100 million, a false claim, according to the Justice Department.

The fraudster tricked investors by showing them doctored bank accounts; one account had a balance of nearly $500 million, while another had a balance of $170 million.

Hardat used the money he raised from the scam to pay off his personal debts, and his rent at the Ritz Carlton. He also used the money to pay for expensive private schools for his children. He owned a Lambhorgini and a Maserati, and a luxury box at the Staples Center in downtown L.A.

In true Ponzi-scheme fashion, Hardat channeled new investor money to pay back prior investors. He frauded at least seven investors through his company O4 Worldwide Holdings, according to the DOJ.

One investor wired him $4 million in 2014, with the agreement that Hardat would pay back the loan plus $200,000 in interest within one week. Besides a late payment of $205,000 in November 2014, Hardat never repaid the victim, instead using $3.8 million of the victim’s money to pay personal expenses and earlier victims, including one court judgment against him, according to the Justice Department.

After the victim confronted Hardat about the debt in December 2014, Hardat allegedly told him of a new business opportunity and represented that the $4 million owed would turn into $12 million. Hardat then wrote the victim a check for $8 million, which later was returned for insufficient funds.

Another victim, who met Hardat through their children’s school events, allegedly wired Hardat a total of $393,854 in loans for his business. Hardat used the money for his personal affairs. He eventually paid back $235,000 with money he scammed from other victims.

(NBA legend Shaquille O’Neal attends the grand opening of Shaquille’s At L.A. Live at LA Live on March 9 in Los Angeles, California. An Indo-Canadian man perpetrated a $5 million fraud by saying O’Neal was his business partner. He also claimed he had close ties with Stephen Curry and Indian American former PepsiCo CEO Indra Nooyi. Photo: Michael Tullberg-Getty Images)

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