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Middle East In-N-Out Scammer Gets 2 Years

SANTA ANA, Calif. (CN) - A California man has been sentenced to two years in federal prison for bilking investors out of millions by falsely promising them In-N-Out restaurant franchises in the Middle East.

Newport Beach resident Craig Stevens, 56, pleaded guilty earlier this year to one count of wire fraud, admitting he fraudulently solicited nearly $4.3 million from investors by claiming he had exclusive rights to In-N-Out franchises in the Middle East.

The problem is that the Irvine-based In-N-Out - prized by residents of the West and travelers alike for its bare-bones menu and delicious burgers - is a privately held corporation that "does not have any business partnerships or franchise agreements with third parties," according to court documents.

Stevens admitted to sending an email to a victim in Lebanon that discussed a purported licensing agreement, the Justice Department said. He told investors that each franchise cost $150,000 plus another $250,000 per year for royalties.

U.S. District Judge Andrew Guilford sentenced Stevens to 24 months in federal prison for the scheme.

Founded in 1948 as the first drive-through hamburger stand in California, In-N-Out expanded to 140 locations in the Golden State by 2000. Since then, the company has opened restaurants in Arizona, Nevada, Utah and most recently Oregon.

The chain is still owned by the family that started it, and the current president says she has no plans to franchise or sell but will instead pass the reins to her two children.

In-N-Out has a loyal following that includes celebrity chefs like Anthony Bourdain, Mario Batali and Gordon Ramsey. And before she passed away, culinary icon Julia Child admitted to carrying a list of In-N-Out locations with her at all times.

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