Four people have been charged by federal prosecutors with allegedly defrauding a San Diego technology company during its $150 million purchase of the defendants' tech start-up, according to an indictment unsealed Tuesday.
According to the U.S. Attorney's Office, the defendants marketed their start-up's microchip technology to the unidentified victim company in 2015.
Though their sales pitch represented that the technology was invented by a Canadian grad student, prosecutors said it was not disclosed that the student was related to one of the defendants, Karim Arabi, who was working as the victim company's vice president of research and development while creating the technology at issue.
The indictment identifies the relative as Arabi's sister, Sheida Alan, who is also charged in the case.
Prosecutors said Arabi's employment agreements held that intellectual property he created would belong to the victim company, so the defendants hid his involvement with their Sunnyvale-based start-up, which was dubbed "Abreezio."
Prosecutors say the defendants hid Arabi's part in Abreezio -- which included picking the company name and filing the provisional patents its core technology was based upon -- by creating sham email accounts in which Arabi impersonated his sister. The indictment alleges Arabi's sister also legally changed her name from Sheida Arabi to Sheida Alan "in order to further mask her connection with defendant Karim."
Abreezio was purchased for $150 million in late 2015 and prosecutors say the defendants laundered the money they received from the sale through foreign real estate purchases and interest-free loans.
Arabi, 56, and Ali Akbar Shokouhi, 63, both San Diego residents, were arrested Tuesday in San Diego, while Sanjiv Taneja, 59, of Cupertino, was arrested in Northern California. Sheida Alan was arrested in Canada and awaits extradition proceedings.