FBI claims corrupt LA cops helped crypto CEO's cash grab

Feds tell thrilling tale of crypto crooks, Facebook scams, fast cars, guns, betrayal … and leg extensions?

Adam Iza, the founder of cryptocurrency trading platform Zort, has been charged with tax evasion and conspiracy in a bizarre tale of corrupt cops and Facebook employees, stolen digicash, and an alleged $30 million scam.

According to court documents [PDF], Iza – aka Ahmed Faiq, aka "The Godfather" – is accused of paying off multiple members of the Los Angeles Sheriff's Department (LASD) and their associates in exchange for protection, access to police data, and getting them to arrest his enemies. Iza boasted about paying the LASD $280,000 a month to support his business – which reaped millions, but paid no taxes to Uncle Sam.

"Iza accumulated significant wealth that he and his co-conspirators funneled through shell companies," testified FBI special agent Barbara Johnson.

"Iza spent the funds on personal expenses, including numerous luxury vehicles, rent payments for a Bel Air mansion, cosmetic surgery to extend the length of his legs, and numerous other luxury expenditures. During the years 2020 through 2022, Iza concealed his receipt of tens of millions of dollars and did not report any income taxes."

Johnson claims much of the money Iza and Zort generated came from Facebook ad scams and outright cryptocurrency theft, aided by corrupt Meta employees and cops. According to the statement, Iza used police databases to illegally track his victims and intimidate them into paying him.

The long, bent arm of the law?

According to the court filing, a person identified as "E.Z." went to the FBI in June 2022, claiming that Iza had tried to kidnap and extort him for the currency stored on his laptop.

E.Z. claimed that in November 2021, he was driving with then-business partner Iza, who asked him to pull over outside a gas station. They were met by a former LASD deputy and a former LASD custody assistant, one of whom pulled a gun and instructed E.Z. to get into their car. He ran off and called the police.

Over the following month, E.Z. received a series of threatening texts displaying personal information from the California Law Enforcement Telecommunications System database (which combines state and national law enforcement data). He also suffered harassments by Iza and his associates that included identity theft, stalking, impersonation, and phone number spoofing.

The indictment further details that in January 2022, a LASD deputy obtained a warrant for the GPS location of E.Z. by falsely linking him to an ongoing firearms investigation with which the FBI said he had no involvement. Iza reportedly boasted that this was possible due to his payoffs to the police.

"Damn my guy actually filed the warrant … that's some serious shit to do for someone … risking 24 years career," he texted to an associate. In a separate message he boasted: "I pay him 280k a month for complete resources." According to Johnson, several LASD staff were paid more than $100,000 by Zort and associated companies.

As described in the court document, in March 2022, three unknown armed suspects allegedly tried to invade E.Z.'s home, apparently to steal his cryptocurrency stash. He fired two shots and they left, but later received a video of the attempted robbery from Iza, along with threatening messages.

Not that E.Z. was an angel, it's claimed. According to another witness, Iza and E.Z. allegedly broke into his house in 2018, held him and his girlfriend at gunpoint, and demanded the passwords to their phones and laptops so that they could steal cryptocurrency.

Don't shaft your staff

The indictment also cites allegations made against Iza by a witness dubbed R.C., who claims Zort paid him $50,000 to organize the founder's 21st birthday party in the summer of 2021.

During the festivities, R.C. was brought to Iza's room, where it's said the Zort CEO was loading bullets into a gun magazine while several members of the LASD ("Victim R.C. observed badges on their belts") and/or bodyguards were in the room. Iza informed R.C. that "he was displeased with the party," and demanded a 50 percent refund.

When R.C. refused, one of the bodyguards took his phone and tried to use facial recognition to unlock it. When that failed, R.C. says he was forced to unlock the device using his password and Iza then withdrew $25,000 from his account. Iza kept the phone along with photos of R.C.'s driver’s license, passport, and multiple credit cards, and subsequently made tens of thousands of dollars worth of additional withdrawals.

The following month, R.C. was pulled over by LASD deputies while out on a date. The deputy found two bags in the car, which it was claimed contained drugs, and R.C. was arrested. During the stop, R.C. claims Iza arrived and talked with the deputy. R.C. was held in jail for three days on charges of transportation of controlled substances, but these charges were later dismissed due to lack of evidence.

The following month R.C.'s home was raided by LASD, who claimed to be acting on a tip off that the suspect was dealing large amounts of fentanyl and cocaine and destroyed the home looking for them. No drugs were found. The deputy who obtained the search warrant was being paid by Iza, the FBI claims.

Follow the money

The FBI investigation tracked payments to at least three deputies and their associates from Zort funds, and also probed how Iza was making his money. This led to the criminal charges.

The Feds worked with the IRS to trace Zort and Iza's businesses and discovered that, in addition to payments to LASD deputies, he and an associate set up two marketing agencies called Dream and Rise. These agencies sold stolen Facebook advertising accounts and, it's claimed, bribed Facebook staff to whitelist adverts that broke the site's terms and conditions.

"Analysis of Dream and Zort's bank activity show Dream transferred approximately $4,098,750 to Zort's bank accounts between October 2021 and July 2022," the FBI investigator said.

Iza, it's said, also entered into "a very profitable scheme," with a foreign national dubbed T.H., selling purloined Facebook accounts from a Serbian accomplice. However, T.H. found himself suffering from mental health issues and Iza encouraged him to enter a rehabilitation clinic.

Once T.H. had checked himself in for treatment, Iza was accused of stealing his laptop and taking over his side of the Facebook advertising business. He also notified the FBI about T.H.'s location and informed them of possible criminal activity.

What Iza didn't know was that T.H. was running an open source screenshotting program called Gyazo on the laptop. This was recording Iza as he used it for yet more business, the court documents state. T.H. told the FBI that the screenshots showed how Iza would phish Facebook account holders and steal their advertising accounts.

"The total amount of income to Iza and Co-Conspirator 1 for all three years (2020-2022) was approximately $33 million," Johnson said. However, during that period, he paid no taxes to Uncle Sam, and the IRS thinks he owes $6,727,658.

Not that he wasn't spending. He and his co-conspirator leased Ferrari, Lamborghini, Rolls-Royce and Mercedes cars (one of which he apparently crashed) and spent tens of thousands on travel and luxury goods, and leased a house in Bel Air at a cost of around $200,000 a month.

In March 2023, Iza left the US and moved to the United Arab Emirates, as well as spending time in Monaco – but he complained that "even $300 million there isn’t shit." He also expressed a desire to move to Switzerland in a Telegram message to a colleague, but returned to the US this July.

Iza was arrested by police on September 23 and is expected in court on October 8. Two days after the arrest, several LASD staff were reportedly relieved of duty after a request "involving the US Attorney’s Office." ®