By Chad Bray and Kelly Nolan
Of DOW JONES NEWSWIRES
NEW YORK -(Dow Jones)- New York businessman and prominent Democratic fund-raiser Hassan Nemazee could be close to resolving criminal charges that he allegedly defrauded three banks out of $292 million in loans, his lawyer said.
After a hearing in Nemazee's case Wednesday, Paul Shechtman, a lawyer for Nemazee, said the parties are discussing a possible disposition in the case by late December. The next hearing in the case is set for Dec. 21.
A disposition could include Nemazee pleading guilty to criminal charges or the government dropping its case.
Nemazee has been indicted on charges of aggravated identity theft and three counts of bank fraud. Each bank-fraud count carries a term of up to 30 years in prison.
Nemazee, who was involved in various presidential campaigns and once served as finance chairman of the Democratic Senatorial Campaign Committee, was initially charged criminally in August related to a loan he allegedly obtained fraudulently from Citigroup Inc.'s (C) Citibank unit.
Prosecutors from the U.S. Attorney's office in Manhattan have alleged that Nemazee, chairman and chief executive of Nemazee Capital Corp., obtained hundreds of millions of loans from Bank of America Corp. (BAC), Citigroup and HSBC Holdings PLC (HBC) between 1998 and 2009.
To perpetuate the scheme, Nemazee allegedly provided fake account statements with forged signatures that claimed he held hundreds of millions of dollars in U.S. Treasury notes and other securities, prosecutors said.
He allegedly used the proceeds from the loans to make donations to the election campaigns of federal, state and local candidates; to make donations to political action committees; to make donations to charities; to purchase property in Italy; to make monthly maintenance payments on properties in Manhattan and Katonah, N.Y.; and to purchase part of a yacht, prosecutors said.
Nemazee made partial repayments on his borrowings from Bank of America with the loan he took out from Citibank, prosecutors said. After Federal Bureau of Investigation agents interviewed him in August, he fraudulently obtained a line of credit from HSBC and used the money to repay Citibank, the government said.
HSBC sued Nemazee in New York State Supreme Court in September, alleging he fraudulently obtained a $100 million loan from the bank and withdrew $75 million in proceeds.
-By Chad Bray and Kelly Nolan, Dow Jones Newswires; 212-227-2017; chad.bray@dowjones.com