Trio Allegedly Involved in Elaborate Scheme

The California Department of Insurance Criminal Investigations Branch’s Fraud Division arrested Hassanein Mohamed Hassanein and two accomplices for an elaborate insurance fraud scheme with a potential loss of approximately $20 million. The National Insurance Crime Bureau assisted the investigation.

Hassanein, 48, of Orange County, is charged with four counts of felony insurance fraud and one count of conspiracy. His accomplice, Walid Abou-Ghazala, 37, is currently in federal custody awaiting trial on bribery charges. Abou-Ghazala is also being charged with four counts of felony insurance fraud and one count of conspiracy.

Another accomplice, Hala El Naggar, 35, is being charged with one count of felony insurance fraud and one count of conspiracy.

The trio was allegedly involved in a fraudulent scheme that occurred between Dec. 30, 1997 and March 10, 1998. The insured contents of five cargo containers for a combined total of $8,856,000 by the Washington International Insurance Company (WIIC) were shipped from Los Angeles to Alexandria, Egypt. Middle Eastern banks paid Letters of Credit in the amount of $8,841,801 to the shipper of the containers by Middle Eastern banks after they received confirmation that the containers were shipped.

Upon arrival in Egypt, the containers were found empty.

Four of the consignees filed claims for the losses with WIIC between April 6, 1998 and December 28, 1998. WIIC denied the claims, reasoning evidence strongly suggested that the containers were never loaded with cargo.

Civil complaints were later filed by the consignees of the containers against WIIC and Evergreen Marine Corporation. The complaints were consolidated under one case and removed to civil court between Dec. 1, 1998 and April 13, 1999.

Evergreen Marine Corporation paid roughly $450,000 to settle the case with the consignees.

There were several allegedly false documents submitted to the federal court as proof of cargo for one of the containers. Additionally, discrepancies were found in the cargo weights declared by Hassanein for each container.

Furthermore, individuals who claimed they were involved with packing and loading the cargo and submitted declarations attesting to the contents were found to have been paid thousands of dollars to sign the declarations and give false testimony in federal court stating that they witnessed or helped with the loading.

WIIC has paid in excess of $2,000,000 in legal defense fees and investigative costs for the fraudulent claims and subsequent lawsuits. They have not paid any money to the plaintiffs.