A day after announcing 13 parents–including a Laguna Beach resident–were pleading guilty to charges related to the Operation Varsity Blues fraud case that sprang from a Newport Beach college admissions assistance service, federal prosecutors today revealed stiffer charges against 16 other parents–including four with Orange County ties–who have yet to cop to crimes.
Heading the list celebrity-wise is Full House’s “Aunt Becky,” Lori Loughlin, 54, and her 55-year-old husband, Mossimo Giannulli, whose Mossimo clothing brand started on Balboa Island.
The U.S. Attorney in Boston today charged them with a second superseding indictment along with locals: Douglas Hodge, 64, the former CEO of Newport Beach investment-management company PIMCO; I-Hin “Joey” Chen, 64, of Newport Beach, a shipping-industry executive; and Michelle Janavs, 48, of Newport Coast and a former executive of her family’s food business that popularized Hot Pockets. (The UC Irvine School of Business and the Jewish Community Center of Orange County are named after her father, Paul Merage.)
Non-local parents now facing new charges are: Gamal Abdelaziz, 62, aka “Gamal Aziz,” of Las Vegas; Diane Blake, 55, and Todd Blake, 53, of Ross; Elizabeth Henriquez, 56, and Manuel Henriquez, 56, of Atherton; Elisabeth Kimmel, 54, of Las Vegas; William McGlashan, Jr., 55, of Mill Valley; Marci Palatella, 63, of Hillsborough; John Wilson, 59, of Lynnfield, Mass.; Homayoun Zadeh, 57, of Calabasas; and Robert Zangrillo, 52, of Miami, Florida.
Originally indicted on conspiracy to commit fraud, these parents now all face money-laundering counts related to the scheme dreamed up by William “Rick” Singer, 58, who operated Edge College & Career Network (a.k.a. “The Key”) out of his Newport Heights home. (Parents David Sidoo, 59, of Vancouver, Canada; Gregory Colburn, 61, and Amy Colburn, 59, both of Palo Alto, were previously indicted in connection with the scheme.)
Singer pleaded guilty in Boston federal court on March 12 to money laundering, racketeering, obstruction of justice and tax evasion. Facing up to 65 years in prison and a $1.25 million fine at sentencing on June 19, Singer is seeking leniency by admitting to having built phony athletic profiles and hiring decoys to take admissions tests for the academically challenged spawn of wealthy parents.
When one set of defendants have pleaded guilty and a second set has not yet done so, federal prosecutors have been known to increase the pressure with additional or stronger charges that can also increase the potential fines and/or prison time with convictions. Conviction on both counts announced today carry a maximum 20 years in lockup.
That threat may have prompted Monday’s announcement that Robert Flaxman, the 62-year-old Laguna Beach resident and founder and CEO of Irvine-based Crown Realty and Development, would enter a guilty plea to one count of conspiracy to commit mail fraud and honest services mail fraud along with actress Felicity Huffman, 56, and 11 other parents.
Legal experts say that, even with guilty pleas, it is unlikely convicted Operation Varsity Blues defendants will escape any federal prison time.
Ali Khoroshahin, 49, of Fountain Valley, and the former University of Southern California head women’s soccer coach, and Donna Heinel, 57, of Long Beach, and the ex-senior associate athletic director at USC, also face federal racketeering conspiracy raps.