Go Directly to Jail, Do Not Pass Go

Chutzpah: Convicted of Insurance Fraud Appeals to Avoid Going to Jail

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Posted on February 8, 2022 by Barry Zalma

Tarek Abou-Khatwa appealed his conviction of a complex, multi-year insurance fraud scheme. He previously asked the court to delay the start of his incarceration pending the outcome of that appeal. On January 31, 2022, the court denied his request, explaining that Defendant’s appeal did not present a “close question” as to each count on which he was sentenced to prison.

In United States Of America v. Tarek Abou-Khatwa, Criminal No. 18-cr-67 (TSC), United States District Court, District of Columbia (February 4, 2022) Tarek’s multiple appeals in an attempt to avoid was again brought to the USDC.

Defendant filed an “Emergency Motion” with the USDC stating his intent to lodge a second appeal, this time challenging the court’s January 31 Order, and he requested that his self-surrender date be postponed pending the outcome of that new appeal.

Defendant’s conviction is presumed valid and he bears the burden of rebutting that presumption. In his previous motion, Defendant failed to rebut that presumption because he did not present a “substantial question of law” as to each count of his conviction for which he faces imprisonment. Accordingly, the court held Defendant’s self-surrender date in place.

Defendant, undeterred by his losses in the USDC, now argues that his self-surrender date should be delayed while he appeals that decision. He contended that his current self-surrender date is not “sufficient to allow time for briefing before both the district court and the court of appeals, as the parties originally intended.” He claims that additional time is necessary for “a motion to the D.C. Circuit appealing this Court’s order denying release pending appeal [to be] decided by that Court.”  He also argues that refusal to grant further delay would “frustrat[e] his appeal rights under Section 3145(c) and Rule 9(b).”

The court disagreed that emergency action is necessary to avoid “frustrating his appeal rights under Section 3145(c) and Rule 9(b).”

ANALYSIS

First, 18 U.S.C. § 3145(c) pertains to appeals of detention orders, not release from custody, and so it is inapplicable. Second, nothing in the court’s January 31, 2022, Order restricts Defendant’s ability to seek relief from the Court of Appeals. The court, aware that the timeline for Defendant to both appeal this court’s January 31 Order and receive a decision on that appeal before his February 10 self-surrender date, is truncated. However, Defendant-not the court-bears responsibility for that accelerated schedule.

Actually, Defendant notified the court that he was appealing his conviction on June 10, 2021 and filed his opening appellate brief on November 1, 2021. Defendant could have moved to delay his surrender date pending appeal at that point, but instead waited until December 6, 2021. When Defendant did eventually file his motion, he requested only a one-month delay, from January 10 to February 10, 2022, which the court granted.

And third, rather than immediately appeal the court’s January 31 Order, Defendant waited two days to again move for relief and then proposed an additional two-day briefing schedule. In short, Defendant’s concerns about his ability to obtain relief from the Circuit are a product of his own doing.

Finally, in a footnote in his reply brief, Defendant requests that if the court denies the present motion that he be permitted “a short postponement, e.g., two weeks, so that he may appeal the Court’s disposition of the instant motion.” In other words, Defendant would like three appeal tracks: one attacking the merits of his conviction, which is now fully briefed and awaiting disposition from the Circuit; a second challenging the court’s January 31 Order denying his request to delay his sentence pending the first appeal, which Defendant reports “is being filed today,” and a third challenging this decision to deny his request to delay his sentence pending resolution of the second appeal.

Accordingly, the court denied Defendant’s latest request to delay the start of his incarceration.

ZALMA OPINION

Tarek’s fraud must have been very successful since he has the funds to have lawyers bring multiple motions and appeals to avoid incarceration. The actions are a clear explication of the concept of “chutzpah” or unmitigated gall. His efforts continue to fail and it is time that he reports to federal prison and begin his sentence after conviction for fraud. The USDOJ should consider determining what other crimes he was involved in that allows his the funds to support the multiple motions and appeals.

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© 2022 – Barry Zalma

Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders.

He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 54 years in the insurance business.

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