For months customers questioned whether Eugene sneaker reseller Michael Malekzadeh scammed them, using their preorder money to support a lifestyle filled with sports cars and expensive watches.
Now, Malekzadeh has been charged in federal court with running a nationwide Ponzi scheme to defraud thousands of customers, owing them more than $70 million prior to dissolution of his company, Zadeh Kicks, in May, according to prosecutors.
The charges were released last Friday in U.S. District Court and document some of the same allegations angry customers had about Malekzadeh’s operation.
The charges include wire fraud, conspiracy to commit bank fraud and money laundering. Malekzadeh’s fiancee, Bethany Mockerman, who acted as Zadeh Kicks’ chief financial officer, also was charged with conspiracy to commit bank fraud.
On Wednesday, Mockerman and Malekzadeh pleaded not guilty during a video call appearance at the federal courthouse in Eugene. They also waived their rights to an indictment by grand jury. Their trial is set to begin in June 2023.
During the hearing, Malekzadeh’s attorney, Joanna Perini-Abbott, said Malekzadeh has been selling assets involved in the case and will turn the proceeds over to the government.
Some of the company’s victims have been posting about refunds they have received in recent weeks in the “Zadeh Relief Group” on the messaging app Discord. Malekzadeh is also listed as a manager and agent for the local cannabis company Eugreen Farms LLC.
