Local News in Brief : Ex-Bank Executive Gets 10-Year Prison Term

Aformer American Pacific State Bank executive was sentenced Monday in U.S. District Court in Los Angeles to 10 years in prison and was ordered to make full restitution for embezzling $2.5 million from the North Hollywood-based bank.

Fereidoon Mafi (Fred) Vassegh, who as senior vice president was the bank’s No. 3 executive, pleaded guilty in November to three counts of federal bank fraud. The maximum possible sentence was 15 years in prison and a $15,000 fine, along with having to pay restitution.

Vassegh, 49, left the bank soon after the scheme was discovered in August, 1983.

According to federal court documents, Vassegh had accumulated at least $384,500 in Las Vegas gambling debts and took money that customers thought was going into certificates of deposit.

Vassegh also made unauthorized withdrawals from customers’ accounts and got money from fabricated loans, according to the records. Bank officials said that Vassegh, a native of Iran, preyed on fellow Iranians, who in some cases were unfamiliar with U.S. banking practices.

Vassegh covered his tracks, federal authorites said, by intercepting bank statements for accounts he had drained and retyping them before they were mailed.

Insurance eventually covered 95% of the bank’s losses, and no customers lost any money. But bank officials have said that staff morale was devastated by the fraud, and that the effect was felt for a year after the incident.

Asst. U.S. Atty. Craig I. DeRoy, who prosecuted the case, said he does not know whether Vassegh has the money to make restitution. Vassegh will be eligible for parole after serving one-third of the prison term.