PUNISHMENT FOR ARSON MUST BE SEVERE
Arson is the most serious form of insurance fraud because innocent people and firefighters die or are injured as a result of the crime. The punishment for this crime cannot, in my opinion, be a severe enough. Some courts treat it as a “white collar” crime. Others recognize it as a serious and violent crime and sentence accordingly.
The United States is a melting pot where people come to find their fortune because of the opportunities not available elsewhere in the world. Most, like my immigrant parents, do so by honestly working hard. Some do so by taking advantage of our legal system. In United States of America v. Majeed Bazazpour, No. 10-4529 (6th Cir. 08/15/2012) the Sixth Circuit Court of Appeal was called upon to resolve the appeal of Majeed Bazazpour to a 240-month prison sentence after he was found guilty by a federal trial jury to multiple criminal acts.
Bazazpour, a Canadian citizen born in Iran, immigrated to Ohio in late 1996. Upon arriving in the Youngstown area, the defendant stayed for a short time with his second cousin, Cyrus Ghassab, and Ghassab’s wife, Farideh Jamali, before finding his own place to live. Between that time and November 2005, Bazazpour, Ghassab, Jamali, and others were involved in various illegal acts in and around Youngstown, including conspiracy to commit mail fraud, money laundering, and arson, as well as aiding and abetting the actual commission of mail fraud, money laundering, and arson. After a lengthy trial, the jury found Bazazpour guilty of:
- Conspiracy to Commit Mail Fraud because Bazazpour and others conspired to use the United States mail to submit fraudulent insurance claims and receive insurance proceeds for fire damage that the co-conspirators either caused themselves or hired other individuals to cause. As part of the conspiracy, the defendant made material misrepresentations to the insurance companies by failing to disclose prior property losses as requested on the insurance applications.
- Conspiracy to Commit Arson of an Interstate Building.
- Conspiracy to Commit Money Laundering.
- Aiding and Abetting Arson in the Commission of a Felony because Bazazpour and Ghassab set fire to the JB’s Foods building in Youngstown, Ohio, in order to obtain the insurance proceeds for the damage caused by the arson.
- Aiding and Abetting Mail Fraud.
- Aiding and Abetting Money Laundering.
The district court sentenced the Bazazpour to 60 months in prison for conspiring to commit mail fraud, 60 months for conspiring to commit arson, 120 months for conspiring to commit money laundering, 120 months for aiding and abetting mail fraud, and 120 months for aiding and abetting money laundering. Each of those sentences was ordered to run concurrently with the others. The district judge also sentenced Bazazpour to a consecutive 120-month sentence for aiding and abetting arson, resulting in an effective prison sentence of 240 months, or 20 years. Additionally, the district judge ordered the defendant to serve three years of supervised release, to pay a $600 special assessment, and to make restitution to three insurance companies in a total amount of $778,648.64.
The defendant contended that the prosecution failed to adduce sufficient evidence to establish his guilt of conspiracy to commit money-laundering, conspiracy to commit arson, and aiding and abetting arson. Faced with clear evidence the appellate court concluded that a rational trier-of-fact would be justified in concluding that Bazazpour, Ghassab, and Jamali conspired to launder fraudulently- received money through the bank accounts of Ghassab and Bazazpour.
Conspiracy to commit arson
Similarly, sufficient evidence was adduced to support the defendant’s conviction of conspiring to commit arson. The overt acts in which Bazazpour allegedly participated included:
(1) setting fire to a building located at 2606 Glenwood Avenue in Youngstown, Ohio, on April 20, 1998;
(2) setting fire to a building located at 608 North Garland in Youngstown, Ohio, on December 11, 1999;
(3) setting fire to a building located at 2604-2606 Glenwood Avenue in Youngstown, Ohio, on April 22, 2004; and
(4) setting fire to a building located at 2732 Glenwood Avenue in Youngstown, Ohio, on June 24, 2005.
The defendant argued that those overt acts cannot support his conspiracy conviction because the jury actually acquitted Bazazpour of setting the fires on April 20, 1998, December 11, 1999, and June 24, 2005. Nevertheless, the jury did find beyond a reasonable doubt that the defendant was guilty of aiding and abetting the setting of the April 22, 2004, fire at 2604-2606 Glenwood Avenue. That single overt act is thus legally sufficient to support the conspiracy charge. Coupled with testimony that Bazazpour misled insurance agents in obtaining insurance for the 2604-2606 Glenwood property and that Earl Adams overheard Bazazpour threatening to reveal that he and Ghassab set the fire at JB’s Foods unless Ghassab paid him $100,000 that Bazazpour felt he was owed from insurance proceeds from a previous fire, a rational trier-of-fact would have more than enough evidence to convict Bazazpour on the charge of conspiracy to commit arson.
That same evidence refutes the defendant’s claim that the jury had before it insufficient proof to support his conviction of aiding and abetting the setting of the fire at 2604-2606 Glenwood Avenue on April 22, 2004.
In his final appellate issue, Bazazpour wages a multi-pronged attack on the effective 240-month prison sentence that the district judge imposed upon him. He contends that the district court erred in calculating his base offense level; that the court should have reduced his sentence due to the duress under which Bazazpour was operating; that the court improperly considered him to be a manager or supervisor of the offenses; and that the court erred in enhancing his sentence for obstruction of justice.
Defendant was properly classified as a manager or supervisor due to the nature of his participation, in owning the businesses, submitting fraudulent insurance documents, and soliciting other co-conspirators to participate. He claimed rights to a larger share of the proceeds when he sued Cyrus Ghassab for additional insurance proceeds. Imposing the two-level increase for serving as a manager or supervisor, the district judge noted, “I have a very different view of his role and his own autonomy in the role. So I don’t take issue with this as you would.” In light of the information before the district court in the government’s sentencing memorandum and the testimony recounted in the trial transcript, the appellate court concluded that the district judge did not err in applying the enhancement in this case.
In his final challenge to his sentence, Bazazpour submited that the district court erred in enhancing his base offense level for obstructing the administration of justice. Although we apply a clearly-erroneous standard of review to the district court’s findings of fact, the determination of whether specific facts actually constitute an obstruction of justice is a mixed question of fact and law that the court can review as if it were the trial court.
In deciding to impose the obstruction-of-justice enhancement, the district court also referred to the testimony of two individuals, Frank Tenney and Earl Adams, indicating that those individuals testified under oath that the defendant “told them not to talk to the ATF.” The district court obviously viewed such testimony as evidence of an effort on Bazazpour’s part to interfere with or obstruct an investigation. A trial court, to impose an obstruction enhancement must fulfill two steps: first, it must identify those particular portions of the defendant’s testimony that it considers to be perjurious, and second, it must either make specific findings for each element of perjury or at least make a finding that encompasses all of the factual predicates for a finding of perjury. When the defendant’s testimony appears to be pervasively perjurious, the district court is not obligated to recite the perjury line by line, so long as its findings encompass the factual predicates necessary for a finding of perjury; in such cases, there is no danger that an enhancement will be imposed solely because the defendant exercised his right to testify.
For the reasons set out above, the convictions were affirmed but the sentence imposed was vacated and remanded to the district court for findings necessary to determine whether an obstruction-of-justice enhancement is proper in this case.
When the trial court reviews the case again she will determine that Bazazpour serves either 10 years, 20 years or something in between. Bazazpour came to this country as an immigrant from the tyrannical regime in Iran. Instead of working hard to earn a living in his new country Bazazpour decided to enter into a life of crime including insurance fraud and the most dangerous form of insurance fraud, arson-for-profit. If there is evidence sufficient to enhance his sentence the court should reinstate the 20 year sentence. If not, she should order he serve the most time possible.
The insurers have, while he is in jail, little chance of obtaining the ordered restitution unless they can attach his assets. If there are assets worth attaching the insurers should sue to collect.
© 2012 – Barry Zalma
Barry Zalma, Esq., CFE, has practiced law in California for more than 40 years as an insurance coverage and claims handling lawyer. He also serves as an insurance consultant and expert witness specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud. Mr. Zalma serves as a consultant and expert, almost equally, for insurers and policyholders.
He founded Zalma Insurance Consultants in 2001 and serves as its senior consultant.
Mr. Zalma recently published the e-books, “Zalma on Insurance Fraud – 2012″; “Zalma on Diminution in Value Damages – 2012,”“Zalma on Insurance,” “Heads I Win, Tails You Lose — 2011,” “Zalma on Rescission in California,” “Arson for Profit” and others that are available at www.zalma.com/zalmabooks.htm.