Los Angeles – LAWFUEL – IRS Announcement – This afternoon, Gordon Goei, of Los Angeles, a former medical doctor, was convicted after a jury trial in United States District Court in Los Angeles of one count of tax evasion and two counts of wire fraud. Goei’s tax evasion and wire fraud charges stem from a scheme he perpetrated from 1999 through 2005 in which he defrauded investors by promising that funds invested in his high-yield investment program would generate millions of dollars in profits within sixty days.
Goei, who resided part-time in Studio City, established shell companies in Nevada in 1999 and 2000 to perpetrate his fraud scheme. According to court papers, Goei used the companies, both known as Aphrodisia, as a part of his scheme in which he promised investors that money invested with him and Aphrodisia would be used to purchase and trade high-yield financial instruments on clandestine overseas markets. Goei promised that these investments would, in turn, generate huge returns in which his investors would share.
The indictment details that Goei did not use investor’s money to purchase high-yield financial instruments. Instead, Goei used a significant amount of the money invested with him for his own personal benefit, including credit card expenditures made on an account in the name of a third party as well as to repay one of his investors in a previous high-yield investment program scheme – a Ponzi payment.
In an effort to delay investor’s discovery of the misappropriation of their money and to delay them from contacting authorities, Goei falsely assured the investors that their money was safe in both telephone and email communications. Goei would blame delays in returning funds to investors on, among other things, the aftermath of September 11, 2001 and the implementation of the Patriot Act, as well as “the unforeseen human element” in the alleged death or illness of the investment program’s directors, managers, and others.
According to court papers, Goei’s tax evasion conviction stems from the fact that, during 2002, Goei personally received and spent approximately $183,000 of his investor’s money by withdrawing $33,300 in cash in Spain, wiring $90,000 to a prior investor in a previous high-yield investment scheme, and by wiring $60,000 to his former roommate, who used the proceeds to pay a variety of Goei’s personal expenses, including payments to an American Express account Goei shared with another. Goei knew he had to pay taxes on the investor money he used for his personal benefit and he failed to do so.
When sentenced, Goei faces a statutory maximum of 45 years in federal prison and fines totaling $750,000. United States District Judge Robert J. Timlin set Goei’s sentencing for September 22, 2008.
The investigation of Goei was conducted by IRS – Criminal Investigation and the Federal Bureau of Investigation in Los Angeles.
