Contractor Guilty of Defrauding Saddleback Valley Unified

 A 58-year-old Tustin man pleaded guilty and was sentenced to two years in prison today for what prosecutors said is the first prosecution for public works fraud in Orange County.

Reza Mohammedi owned and operated Southland Construction, which did business in Orange, Los Angeles, Riverside and San Bernardino counties.

Mohammedi hired mostly undocumented immigrants and threatened to turn them in if they reported that they were being paid $13 per hour, while he was invoicing public agencies for paying wages of to $53 per hour, said Deputy District Attorney Shaddi Kamiabipour.

That meant more than $350,000 in employee wages was skimmed by Mohammedi from public works contracts. His theft was covered by filing fraudulent tax returns, the prosecutor added.

"In public works cases in the past they're prosecuted as nothing more than misdemeanors and they paid resitution and got dismissals," said Kamiabipour. "This is the first time it's been a felony prison sentence in California."

Mohammedi accepted a plea bargain offer from Orange County Superior Court Judge Robert Fitzgerald, Kamiabipour said.

The fraud was unique and merited a prison sentence because of the amount of money he is alleged to have embezzled, the number of victims, the tax evasion and his prior conviction for similar conduct, Kamiabipour said.

"It wasn't an isolated incident. He pretty much did it in every project and he had projects all over," Kamiabipour said.

Most other municipal officials have pursued damages in civil courts, Kamiabipour said.

Mohammedi has already served nearly three months in jail as the case was pending, so he has less than a year to go in prison, Kamiabipour said.

Mohammedi had public works construction contracts with the cities of Brea, Fullerton, Orange, and Laguna Woods, Orange County, the Saddleback Valley Unified School District and the Orange County Transit Authority between December, 2008 and February, 2012.

Mohammedi submitted payroll reports stating the correct wage of $42 to $53 per hour on each project, but he was actually paying his workers $13 an hour, Kamiabipour said.

The defendant issued checks with the correct amount, but then made workers kick back the difference in cash, or forced them to pay for construction materials or to pay a co-worker out of their wages, Kamiabipour said.

A hearing to determine restitution to Mohammedi's former employees was scheduled for Nov. 29.

- City News Service