Office of the Attorney General News Release Archive



Tuesday, April 18, 2000

ATTORNEY GENERAL CORNYN OBTAINS $1.7 MILLION FOR DEFRAUDED CAR PURCHASERS AND BUSINESSES

AUSTIN - Texas Attorney General John Cornyn obtained a $1.7 million dollar judgment for Texas consumers and businesses against Ali Yazdchi who organized a used car sales scam.

"This is another clear signal to fraudulent and deceptive businesses that my office will take strong enforcement action to protect consumers," said Attorney General Cornyn.

Ali Yazdchi, who used more than 63 aliases, sold used cars to Houstonians who thought they were buying low mileage vehicles in good condition. In fact, Yazdchi bought heavily damaged, luxury cars at auto auctions, had the cars cosmetically repaired, sometimes rolled back the odometers, then in some cases,"washed" the title containing mandated information that the car had been flooded, damaged, or salvaged.

The Attorney General's Office sued Yazdchi based on a referral from the Houston Police Department, in November, 1999. At that time, the court froze approximately $2.75 million in cash assets under the defendant's various names. Former District Judge David West was appointed Temporary Receiver to manage the frozen assets.

Numerous consumers testified that they experienced serious problems with their cars immediately after purchasing them. Many learned from mechanics that the cars had been flooded, fixed with inferior parts, or had massive--even dangerous--frame damage. Consumers were unable to contact Yazdchi to get their money back.

Besides defrauding consumers, the State put on evidence that Yazdchi cheated several local business--leaving unpaid bills for phone service and newspaper advertisements, filing false insurance claims and claims for disaster relief, and stopping payment on checks to pay for furniture.

Yazdchi has been charged with aggregated felony theft charges by the Harris County District Attorney. His criminal trial has been set for later this summer.

The judgment, signed by 61st District Judge John Donovan prohibits Yazdchi from ever selling cars in Texas again. As part of the order, the State will begin reimbursing hundreds of victimized consumers and businesses. The total value of the settlement could be between $1.6 and $1.8 million. The bulk of that money is expected to be refunded to consumers. Assistant Attorneys General John Owens, Suzanne Bradley, and Sarah Hinojosa assisted in the prosecution of the case.

- 30 -


Contact Mark Heckmann, Heather Browne, or Tom Kelley at (512) 463-2050