A U.S. judge has handed 70-year-old Najeeb Khan a 97-month a 97-month jail sentence for playing fast and loose with bank fraud and tax evasion. His escapades involved swindling a whopping $150 million and amassing a colossal car collection of over 240 vehicles. The collection, which made quite a stir when it hit the auction block as part of RM Sotheby’s Elkhart Collection last year, is now part of his colorful history.
Khan had been operating a large payroll processing company Interlogic Outsourcing when his scheme began. He would write checks and make wire transfers between multiple accounts under his control at a number of banks in what is known as a check-kiting scheme. This would fraudulently inflate account balances and deceive banks into honoring checks written with insufficient funds.
Read: 240+ Car Collection Owned By Accused Fraudster CEO Is Simply Stunning
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Court documents reveal that the 70-year-old would write checks from IOI accounts with Lake City Bank for deposit into IOI accounts at KeyBank. He then wrote checks from IOI accounts at Berkshire Bank for deposit into IOI accounts at Lake City Bank. The checks issued from Berkshire Bank were then covered after Khan wired IOI accounts at Keybank to IOI accounts at Berkshire Bank. While that may seem a little confusing, what it meant is that Khan “essentially gave himself a $150,000,000” loan and went on a spending spree.
With his newfound riches, Khan began to build up a massive, multi-million dollar car collection in the U.S. The collection included a dizzying array of classics and modern cars, including a 1952 Ferrari 225 S Berlinetta, a 1955 Cooper-Jaguar T38 Mk II, a 1953 Fiat 8V Supersonic by China, and three Jaguar continuation cars consisting of a 1957 XKSS, a 1963 E-Type Lightweight, and a 1955 D-Type. The collection was sold by RM Sotheby’s in October 2020 and grossed over $44 million in sales.
U.S. District Judge Pamela Barker ordered Khan to pay $121 million in restitution to KeyBank and $27 million to the clients he stole money from. He has also been ordered to pay $9.8 million to the IRS for taxes he didn’t pay for five years.
“This defendant essentially gave himself a $150,000,000 loan, spent money however he wanted on himself and his business, then defaulted, all without ever getting the banks’ approval to give him that loan,” U.S. Attorney Rebecca C. Lutzko said. “These types of financial crimes undermine the well-being of our financial institutions and harm our entire community. This office will vigilantly investigate and prosecute persons who engage in such conduct to protect and prevent harm to financial institutions locally and nationwide.”
Khan gets to keep his retirement fund, a pair of trusty laptops, a Glock sidekick, some dapper attire, and his faithful 2005 GMC Yukon, all included in the agreement he hammered out.
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