California man accused of spending Covid relief loan money on Ferrari, Bentley

An Irvine man was arrested and charged on Friday, May 7, for allegedly obtaining $5 million in COVID-19 relief funds for his “sham businesses,” and he is accused of using the money to buy luxury sports cars, federal authorities said.

Mustafa Qadiri, 38, of Irvine was named in a federal grand jury indictment returned Wednesday, May 5, charging him with six counts of money laundering, four counts of bank fraud, four counts of wire fraud, and one count of aggravated identity theft.

Prosecutors say Qadiri claimed to operate four Newport Beach-based companies: All American Lending and All American Capital Holdings were purportedly mortgage businesses, while RadMediaLab and Ad Blot were advertising businesses.

In May and June 2020, he submitted false Paycheck Protection Program loan applications to three banks on behalf of those companies, according to the indictment.

Authorities allege that in the applications, Qadiri changed bank account records with inflated balances, gave false information about how many employees were paid wages, and gave fake quarterly federal-tax return forms.

He is also accused of using someone else’s name, Social Security number and signature to apply for one of the loans.

None of the businesses are operating, according to the indictment, and the banks funded the PPP loans and transferred funds into the accounts Qadiri controlled.

Those loans were made available through the CARES Act, designed to provide emergency funding to help Americans suffering from the economic effects of the COVID-19 pandemic. Part of the funds were forgivable loans to small businesses to retain employees and for other expenses.

Once Qadari received the money, he bought luxury cars such as a Ferrari, a Bentley and a Lamborghini, federal authorities said, and he also went on lavish vacations and paid for other personal expenses.

Federal agents have since seized the cars along with $2 million from his bank account.