CHICAGO (CN) – An Illinois man admitted being part of a Ponzi scheme that scammed Muslims for $40 million. Amjet Mahmood, 47, of Des Plaines, pleaded guilty to federal charges of conspiring to commit wire fraud, mail fraud and bank fraud.
Mahmood said he used the money to bankroll a motorcycle parts-maker in Pakistan, other companies in Illinois and to pay his own mortgage.
Mahmood faces up to 5 years in prison. He works now as a Chicago cab driver.
Mahmood and two other men – Salman Ibrahim, 37, and Mohammed Akbar Zahid, 59 – were indicted in November. Ibrahim and Zahid remain at large.
Prosecutors say the men persuaded fellow Muslims to invest a total of $30 million in real estate ventures, claiming that the investments complied with Islamic law. They told investors they would not be paid interest, which is prohibited by Islamic law, but would share profits from real estate projects, the indictment states.
The scheme collapsed in 2008. Banks lost more than $13 million and there were more than 300 individual investors at the time.