Crime occasionally pays—until you get caught.
Najeeb Khan has been sentenced to 97 months in prison for a check-kiting scheme that netted him over $180 million, according to the Associated Press. Khan used the ill-gotten funds to bankroll a lavish lifestyle that saw him build one of the world’s most revered collections of classic cars.
Khan perpetrated the fraud between 2011 and 2019 while growing his Elkhart, Indiana-based payroll processing company. During this time, he funneled hundreds of checks and wire transfers with insufficient funds between three banks, including Cleveland-based Key Bank, to artificially inflate the amount in his accounts, according to the U.S. Attorney’s Office Northern District of Ohio. When the strategy finally collapsed, about 1,700 of his clients lost out on money Khan’s company had withdrawn to cover payroll taxes. Some of his victims had to pay the IRS by using their own funds, taking out lines of credit, or laying off employees.
During the sentencing, Khan told a federal judge that he had been “blinded by greed,” according to Cleveland.com. Prosecutors say he essentially gave himself a $150 million loan and used the money to go on expensive vacations and to buy mansions in Arizona and Michigan, as well as additional property in Florida and Montana.
The stolen money was also used to buy airplanes, boats, a helicopter, and a massive collection of multi-million dollar classic car, including a 1952 Ferrari 225 S Berlinetta, 1953 Fiat 8V Supersonic by Ghia and a 1963 Jaguar E-Type Lightweight, according to CarScoops. The assemblage of vehicles was auctioned off by RM Sotheby’s as part of its Elkhart Collection sale in the fall of 2020. The auction grossed over $44 million, with seven cars fetching seven-figure sums. Khan’s lawyer said that the money from the sale was used to help his victims recover funds.
In addition to Khan’s prison sentence—which works out to eight years and one month—he has also been ordered to pay over $150 million to his victims and the IRS. This includes $121 million in restitution to Key Bank, $27 million to his former clients, and $9.8 million in back taxes. He will also have to serve three years of supervised release once released from prison.