An Indian American businessman has been arrested and charged in connection with an alleged scheme that prosecutors say defrauded a financial institution of nearly $100 million through the manipulation of insurance policy records.
Federal authorities arrested Mahender Makhijani, a 44-year-old financier originally from India, at his Newport Beach, California, residence on Wednesday morning. Makhijani, who holds U.S. permanent resident status through a Green Card, faces federal charges that could carry a maximum sentence of 30 years in prison if convicted.
According to investigators, the case centers on allegations that Makhijani orchestrated a complex fraud involving the alteration and misuse of title records tied to insurance policies. Prosecutors claim the scheme enabled him to secure financing under false pretenses, resulting in losses approaching $100 million.
The criminal allegations extend beyond the financial fraud case. Court documents and law enforcement filings accuse Makhijani of using aggressive tactics to gain control of several businesses, including hotels and a restaurant in an affluent Southern California community.
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Authorities allege that some of those efforts involved armed associates who were dispatched to take possession of the properties. Investigators are also examining claims that Makhijani hosted parties involving illegal drugs and sex workers, adding another layer of scrutiny to the case.
The arrest marks a dramatic fall for the financier, who had established himself in Southern California business circles.
“Mahender Makhijani, a lawful permanent resident from India living in Corona del Mar, was arrested this (Wednesday) morning on a federal criminal complaint charging him with defrauding a bank out of nearly $100 million,” as per Bilal Essayli, First Assistant U.S. Attorney for the Central District of California.
According to investigators, Makhijani controlled Newport Beach-based Cantor Group V LLC, a lending company that maintained a financing relationship with a federally insured bank. Under that arrangement, the bank advanced nearly $100 million to the company to originate or acquire real estate-backed loans.
Authorities say the company was required to pledge those loans and the underlying properties as collateral to the bank and repay the advances from loan proceeds. Instead, prosecutors allege that Makhijani engaged in a months-long effort to conceal problems with the collateral securing the transactions.
The U.S. Internal Revenue Service alleges that Makhijani manipulated title insurance documents, concealed the true lien positions attached to properties, and relied on a network of shell companies to mislead the bank about the quality of the collateral backing the loans.
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According to the criminal complaint, between September 2024 and April 2025, Makhijani allegedly altered title insurance policies to falsely indicate that Cantor held the primary lien position on certain real estate assets. Investigators claim the documents were then submitted to the bank through one of Makhijani’s employees.
Prosecutors further allege that when bank officials raised concerns about discrepancies in the title records, Makhijani repeatedly misrepresented the status of the properties during conference calls with representatives of the financial institution.
“Our special agents followed the money through layered transfers and disguised accounts, uncovering a scheme designed to deceive at every turn. When individuals manipulate documents and abuse financial systems for personal gain, IRS CI will expose the truth and ensure they are held accountable,” according to Darren Lian, Acting Special Agent in Charge of IRS Criminal Investigation’s Los Angeles Field Office.
Federal investigators have also linked Makhijani to a broader pattern of alleged misconduct that extends beyond the bank fraud allegations.
According to court filings, Makhijani is accused of organizing private gatherings where illegal drugs and sex workers were present. Some of those events were allegedly attended by employees connected to the financial institution involved in the fraud investigation.
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Prosecutors claim Makhijani later exploited information from those gatherings to exert influence over individuals within his business network. Court documents allege he used knowledge of participants’ activities to pressure employees and associates, helping him maintain control over key relationships.
The filings further describe an atmosphere of intimidation within his business operations. Investigators allege that Makhijani threatened subordinates with severe personal and financial consequences if they failed to follow his directives. Court records state that he warned some employees he would “kill” them and put their “family on the street” and “their kids on welfare.”
The latest criminal allegations come as Makhijani faces mounting legal troubles on multiple fronts.
In a separate civil dispute tied to Southern California real estate transactions, an arbitrator reportedly ruled last month that Makhijani is liable for more than $1.3 billion in damages stemming from his dealings with Laguna Beach developer Mohammad Honarkar.
The allegations against Makhijani extend beyond the bank fraud case. Records filed in both the criminal proceeding and a separate real estate battle accuse him of leveraging fear and pressure to gain an advantage over rivals. Among those named in the dispute is Laguna Beach businessman Mohammad Honarkar.