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Mehran admitted he began skimming the cash in 2000 at two of his furniture stores, telling bookkeepers at his Passaic-based company to withhold roughly $3.8 million in cash from corporate accounts for two of his stores, then called Moda Furniture and Moda Fairfield. Then he kept the money for himself, the government says.
When it came time to forward corporate account records to his accountant, they were a little light, McBride said. In the end, the IRS got false corporate and individual tax returns from Mehran and his businesses.
For calendar year 2003, Mehran reported his total personal income at $909,991. That was false, admits Mehran, who hopes a guilty plea will get him a lighter sentence than if he’d been convicted at trial — a certainty given the government’s evidence.
Mehran founded Moda in 1996, opening stores in Paramus, Fairfield, Passaic, Paterson, Manhattan, Elmhurst and East Middletown, NY.
In 2005, he paid more than $250,000 for the rights to the defunct Huffman Koos name and its Internet domain from bankruptcy court — in the very same complex where he’s pleading guilty this morning. His plan at the time, Mehran said, was to re-establish the Huffman Koos name in all 50 states, as well as in China, Vietnam and Italy.
U.S. District Judge Katharine S. Hayden could end up sentencing Mehran to as much as three years in prison, under federal guidelines. He also could get probation, with fines and an order that he pay the cost of his own prosecution.
Acting U.S. Attorney Ralph J. Marra, Jr. credited Special Agents of the IRS-CI, under the direction of Acting Special Agent In Charge, Julio LaRosa, for the investigation leading to the guilty plea.
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