Developer who owns 40-acre Calverton industrial site indicted in $8.5M pandemic-era loan fraud

A New York City real estate developer who owns industrial land in Calverton is facing federal felony charges alleging he defrauded multiple pandemic-era relief programs out of millions of dollars.

David Ebrahimzadeh, 45, of Manhattan, was indicted by a federal grand jury in Boston on one count of bank fraud, two counts of wire fraud affecting a financial institution, one count of wire fraud and two counts of procuring a false tax return, according to a press release issued by the U.S. Attorney’s Office for the District of Massachusetts.  Prosecutors said in the release that Ebrahimzadeh allegedly obtained about $8.5 million in loans “he was not entitled to.”  

Ebrahimzadeh is a principal in a limited liability company that owns a 40-acre parcel of industrially zoned vacant land on Middle Road in Calverton once slated for development with a 640,000-square-foot logistics center by NorthPoint Development of Missouri. 

In a July 2024 interview, Ebrahimzadeh said he had owned the property “50-50” with NorthPoint Development through a limited liability company, NP Riverhead Industrial LLC, which purchased the site in December 2021.  Ebrahimzadeh said during that interview he’d bought out his partner’s interest in the limited liability company in May 2024. See prior story: Riverhead Logistics Center plan scrapped: NorthPoint sells out to partner, who says he’ll build ‘drastically’ scaled-down warehouse facility

A declaration affecting title to the property was signed by Ebrahimzadeh July 25 and recorded with the county clerk Sept. 30, states that a company called Corniche SRY IV, LLC is the owner of NP Riverhead Industrial LLC and that Ebrahimzadeh is the sole member and manager of Corniche SRY IV.

Ebrahimzadeh’s representatives have met with town planning staff in December and January for presubmission conferences regarding development of the site with two warehouse buildings. At the Jan. 13 presubmission conference, town planning staff suggested the developer pursue non-warehouse uses permitted by the zoning of the site, which is Light Industrial.

Federal prosecutors allege Ebrahimzadeh operated Corniche Capital LLC as a holding company for various limited liability companies used to buy and sell commercial real estate and lease properties to commercial tenants.  Under Small Business Administration rules, the U.S. Attorney’s Office said, such “passive” real-estate businesses were ineligible for Paycheck Protection Program loans and Economic Injury Disaster Loans, as well as for loans funded by the Federal Reserve Bank of Boston through the Main Street Lending Program.  

Nevertheless, prosecutors allege that soon after the outbreak of the COVID-19 pandemic, Ebrahimzadeh applied for and received loans through each of those programs, and that his applications contained “false and fraudulent information,” including false revenue and payroll figures.  The press release also alleges he provided false financial information about his debts and liabilities to lenders and sought relief loans for companies that had been dissolved years before the pandemic.  

Prosecutors further allege Ebrahimzadeh spent loan proceeds on luxury items, personal and business debt and a personal home on Long Island.  The press release adds that after he succeeded in buying one personal home, he and a family member allegedly obtained another pandemic relief loan to buy a second Long Island home.  (The indictment describes the two purchases as the “First Hamptons House” and “Second Hamptons House.”) 

The U.S. Attorney’s Office also alleges that in 2021 Ebrahimzadeh fraudulently sought forgiveness of a PPP loan by falsely claiming he had paid employees in 2020.  As part of that alleged forgiveness scheme, prosecutors said, Ebrahimzadeh filed tax returns that falsely claimed expense deductions in 2019 and about $600,000 in wage expenses in 2020.  

The indictment alleges that Ebrahimzadeh was Corniche Capital’s sole employee and officer. It also alleges he submitted multiple PPP applications that claimed payroll amounts far above what would have been permitted for a one-employee business under program rules, and that he later spent PPP funds on items including jewelry and personal expenses instead of payroll.

The indictment alleges Ebrahimzadeh sought Economic Injury Disaster loans in the names of various entities — including entities that had been administratively dissolved years earlier — and claimed substantial 2019 gross revenues when, prosecutors allege, the entities actually had no revenue. 

The indictment also lays out allegations tied to Main Street Lending Program loans connected to Corniche Capital and to another company. It alleges Ebrahimzadeh submitted borrower certifications and financial information that omitted liabilities and overstated assets, and later used Main Street loan proceeds in connection with acquiring the first Long Island home, paying off a mortgage on a Pennsylvania property and loaning money to another real estate company. 

Ebrahimzadeh pleaded not guilty to all charges at his arraignment in federal court in Massachusetts on Dec. 12, according to court records. He was released on a $100,000 bond. The case is pending with the next court date currently scheduled March 19. 

Ebrahimzadeh declined to make a statement for this article. His defense attorney did not respond to a request for comment.

The charges of bank fraud and wire fraud affecting a financial institution each carry a maximum sentence of up to 30 years in prison, while wire fraud carries a maximum of up to 20 years, the U.S. Attorney’s Office said.  Each count of procuring a false tax return carries a maximum sentence of up to three years, prosecutors said.  

The case was investigated by the Federal Reserve Board’s Office of Inspector General, the FBI’s Boston Division and IRS Criminal Investigation in Boston, with assistance from the Special Inspector General for Pandemic Recovery, the U.S. Attorney’s Office said.  

Editor’s note: A criminal charge is an accusation. A person charged with a crime is presumed innocent unless proven guilty in a court of law.