Ausaf Umar Siddiqui, now faces formal arraignment on nine charges

Ausaf Umar Siddiqui, who goes by "Omar,'' now faces formal arraignment on charges Jan. 15 before U.S. Northern District Court Magistrate Judge Patricia V. Trumbull.
The nine felonies carry a maximum penalty of a 30-year prison sentence. But federal sentencing guidelines also treat first-time offenders much more leniently.
The indictment is similar — but smaller in scope — to the arrest complaint filed Dec. 18, which alleged Siddiqui cheated Fry's out of $65 million over three years. The indictment charges only nine transactions totalling less than $6 million from June 2005 to November 2008. And instead of naming five vendors by name, as was listed in the arrest complaint, the indictment limits the illegal transactions to only two unnamed vendors."How does it go from $65 million when he was arrested to less than $6 million now?'' asked Eric Sidebotham, Siddiqui's civil attorney helping him fend off casinos across the country who are suing him for millions they say he owes them. "I find that number really interested. It's not nearly as bad as they originally charged.''Sam Polverino, a criminal defense attorney who made a special appearance on Siddiqui's behalf at his bail hearing in December, said this morning that he was not retained to represent Siddiqui.The basic allegation in the original IRS complaint is that Siddiqui used his Fry's position to make "secret, backroom sales contracts to vendors, and in return, vendors gave him a kickback.'' Siddiqui allegedly used the kickbacks to feed his high-roller gambling lifestyle.IRS spokeswoman Arlette Lee said while the IRS has traced "numerous transactions,'' only nine have been formally charged because the money transfers were relatively "clean,'' meaning the deposits from vendors to Siddiqui, and the payments from Siddiqui to the Venetian casino in Las Vegas were simple to trace.For example, the charging document shows that on June 8 2005, a vendor wired $1 million from a bank in New Jersey to Siddiqui's bank in California, then that same amount of money was wired to the Venetian casino in Vegas two days later. Lee stressed that the investigation is still ongoing, and federal authorities charged what they had because they had 20 days from Siddiqui's arrest to file some sort of charge.
Siddiqui had until Wednesday to pay half of his $300,000 bond, and sign that he's good for the rest if he wishes to remain out of custody. He is now allowed to remain at his Palo Alto condominium as long as he wears an electronic monitoring bracelet. It's unclear where Siddiqui will find the money for his bond and for his attorneys, now that he is fired from his job. While Siddiqui has been sued by at least half a dozen casinos from Atlantic City to the Vegas Strip, he has no criminal record.
Siddiqui's last post at Fry's, where the 42-year-old has worked since 1988, was vice president of merchandising and operations. Fry's fired him Dec. 22.In statements, Fry's executives have distanced themselves from Siddiqui, and last month, sued him for $10 million they say he owes to the giant electronics retailer based in San Jose.
In addition, the indictment reveals for the first time that following his arrest in mid-December at Fry's headquarters on Brokaw Road, the IRS seized a 2006 Mercedes Benz CLS 55 from his home. Also, from his briefcase, the IRS seized $30,100 in cash, 3,100 British pounds, 240 Euros and 13 bank debit cards.