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After Loss in Eaze Bank Fraud Trial Akhavan Hit With $17M Forfeiture After 2d Cir Ruling

by Matthew Russell Lee, Patreon Book Substack

SDNY COURTHOUSE, Jan 29 – Hamid Akhavan was sentenced to 30 months for his role in the Eazy marijuana delivery service bank fraud, in a trial Inner City Press covered and won unsealing of documents in.

  On January 22 Akhavan appeared before U.S. District Court for the Southern District of New York Judge Jed S. Rakoff. Inner City Press went to cover it. Thread:

OK - now at US v Hamid Akhavan, Inner City Press reported on and unsealed the trial, which beyond marijuana delivery service Eaze touched on OneCoin and Hargreaves

Judge Rakoff: This case is here on remand from the Seconf Circuit for resentencing. They said the banks had been exposed to liability, and that Mr Akhavan controlled $17 million... If I do impose the $17 million, what would the payment plan be? 

AUSA: We could explore alternate assets. Judge Rakoff: What if I order 5% of his gross monthly income?

Defense (Quinn Emanuel) We think $17 million is disproportionate. Judge Rakoff: 5% of zero is zero.

AUSA: $17 million is not unconstituonal here. And it's the defense that bears the burden. Akhavan was the leader of this fraud

Judge Rakoff: If there were victims here, I would be more sympathetic to the Government's position. He served 30 months in prison. AUSA: Financial penalties are important in these white collar cases. He pocketed $8.5 million   [Akhavan is whispering animatedly in the ear of 1 of his 2 lawyers]

AUSA: Congess has spoken in the bank fraud statute. Jydge Rakoff (smiling) Yes, banks must be protected.AUSA: We are not seeking to seize any business, only to enter a money judgment. He increased banks' compliance costs. Defense: Mr Akhavan never had these funds. It was an entirely digital world, taking marijuana into it. All he had was the stock options.

AUSA: The money went to Jaw13 - who was Akhavan, referred to as jawbreaker 13 on Telegram. He didn't invest 3 years and take nothing. Defense: This was about the merchant processing banks. Our client never received this money.

  Judge Rakoff: Are you claiming Mr Akhavan did this for ideological and not mercenary reasons? If so he should apply for a Mother Theresa award. But actually he lied to banks that the funds weren't from marijuana. Defense: He didn't intend to harm banks.

Defense: Mr Akhavan is now unbanked. Akhavan: I did this because a dying friend couldn't buy weed with a credit card. I didn't need this. I did not get money from this. The Government is lying. Dispensaries today are not being prosecuted, they take cards... 

Akhavan: I've lost my business, my wife, my kid. I've been living with my parents for the last year and a half. Judge Rakoff: The jury found you guilty. I urge you to look forward, and not hold a grudge - that's just punishing yourself.

 Judge Rakoff: I hope you don't dwell on the past, for your own happiness. I'm not going to rule right now, but in February, with the extra day

AUSA: It has to be in person 

On January 29, Judge Rakoff docketed a ruling that "orders that Akhavan pay forfeiture under 18 U.S.C. § 982(a) (2) in the amount of $17,183,114.57, to be paid at a rate of 5% of Akhavan's gross monthly income, beginning in the month after the amended judgment is entered in this case. In addition to the payments of 5% of his gross monthly income, Akhavan must cooperate with the Government to provide any other forfeitable assets that will be credited toward the $17,183,114.57 upon their tender."

Judge Rakoff wrote that "although the Court previously held such a forfeiture to be an excessive fine prohibited by the Eighth Amendment, the Second Circuit's vacatur order undercut both aspects of the Court's reasoning that tilted in Akhavan's favor."

 Inner City Press will continue to cover the case.

It is US v. Weigard, et al., 20-cr-188 (Rakoff)


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