San Antonio Man Admits Role in Title Washing Scheme Involving Over 600 Fraudulent Titles

U.S. Attorney’s Office, Western District of Texas
July 26, 2011

United States Attorney John E. Murphy announced 27-year-old Babauk Omeed Harizavi of San Antonio, Texas, faces up to 20 years in federal prison after pleading guilty today to his role in a vehicle title washing scheme involving over 600 Texas vehicle titles.

Appearing before United States District Judge Harry Lee Hudspeth, Harizavi pleaded guilty to one count of mail fraud and aiding and abetting. According to court records, between June 2009 and October 2010, Harizavi and others created a scheme to defraud, by requesting and filing fraudulent paperwork with the Texas Department of Motor Vehicles, to seek clean Texas vehicle titles using the mechanic’s lien process. Upon receipt of the clean Texas vehicle titles, the defendants sold those vehicles to unsuspecting consumers or third parties without disclosing the past “certificate of destruction,” “salvage title,” or “parts only” title histories of those vehicles. Harizavi and his codefendants are collectively responsible for 613 fraudulently obtained Texas vehicle titles issued by the Texas Department of Motor Vehicles based on fraudulently filed mechanic’s liens.

While operating a company in San Antonio, Harizavi exploited the mechanic’s lien process by creating and filing fraudulent mechanic’s lien paperwork with the Bexar County Tax Assessor Collector’s office. Harizavi advertised his title washing business on the Internet. In open court, Harizavi admitted to creating and filing fraudulent mechanic’s lien paperwork for a Chevrolet Uplander that had been purchased by a co-defendant from a General Services Administration (GSA) car auction. The Uplander had a “Parts Only-Not for Highway Use-Salvage” rating on its title. After Harizavi filed the fraudulent mechanic’s lien paperwork, a clean vehicle title was issued and mailed with no reference to the salvage rating. Harizavi admitted that he knew that a co-defendant intended on selling the vehicle with the clean Texas title.

“Title washing” is the fraudulent process through which a vehicle’s title is corruptly altered to conceal information that should normally be contained on the title, such as a previous salvaged title or a financial lienholder. A vehicle that has a “certificate of destruction,”“non-repairable” history, or “parts only” history can only be utilized for parts or scrap metal, and can never receive a clean title.

Co-defendants Hassane Mahmoud Kobeissi, of Swedesboro, New Jersey, Daniel Thomas Bass, of San Antonio, Texas, and Jayeshkum C. Patel, of Sayerville, New Jersey, have previously pleaded guilty to mail fraud. Hassane Mahmoud Kobeissi also pleaded guilty to smuggling goods from the United States. Co-defendant Jerry Edward Weaver, of Rowlett, Texas, is set for trial before United States District Judge Harry Lee Hudspeth on September 19, 2011.

Operation Title Sweep was initiated by the Federal Bureau of Investigation in San Antonio, Texas Department of Public Safety, United States Postal Service and the National Insurance Crime Bureau. Also assisting in the investigation were the Texas Department of Motor Vehicles and the Office of Inspector General - General Services Administration. Also providing assistance to the investigation was the Hartford Insurance Agency. Assistant United States Attorneys Sarah Wannarka and Thomas P. Moore are prosecuting this case on behalf of the government.