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LA, Suburb Cry Fraud Over $300M Housing Projects

Law360 (April 25, 2011, 4:59 PM EDT) -- Los Angeles and Glendale, Calif., on Thursday alleged that Advanced Development and Investment Inc. overbilled and otherwise defrauded them in the construction of 19 affordable housing projects that cost nearly $300 million.

The cities' separate complaints accuse ADI, two affiliated companies and several individuals — including former top executives Ajit Mithaiwala and Salim Karimi — of hyper-inflating budget estimates to justify the awarding of tax credits and construction loans.

The defendants also submitted hyper-inflated construction draws, fraudulent subcontractor invoices and doctored waivers and releases; coerced subcontractors...
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