September 24, 2014

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Tax consultant pleads guilty to bilking clients

CLEVELAND — Tax consultant Richard Zakarian pleaded guilty Tuesday to federal mail and wire fraud charges for stealing more than $4.4 million from nearly 100 clients in schemes dating back more than a decade.

Zakarian, 47, could receive up to 20 years in prison under the terms of his plea agreement, U.S. District Judge Dan Aaron Polster said during Tuesday’s hearing.

Richard Zakarian

Prosecutors and Zakarian’s defense team still need to settle a dispute over whether the jailed Vermilion resident obstructed justice during the course of the investigation into his business dealings. The results of that hearing will have an impact on how long Zakarian is imprisoned.

Clad in the wrinkled Cleveland Indians’ polo shirt he was wearing when he was arrested on state charges last August, Zakarian was led into the courtroom and uncuffed before the hearing began. He left in handcuffs again after declining to contest remaining incarcerated until his Aug. 7 sentencing hearing.

Zakarian stole from clients in two ways, according to prosecutors. First, he took investors’ funds and lost them in high-risk investments. He also took money from clients of his payroll company and used them to cover his own expenses.

Charles Northcutt III, Zakarian’s attorney, said after Tuesday’s hearing that his client never meant to steal from those who trusted him with their money.

“At the end of the day, he feels bad that a lot of folks lost money; he lost money,” Northcutt said. “And he wants to take responsibility.”

Contact reporter Brad Dicken at (440) 329-7147 or bdicken@chroniclet.com.