Seku N. Shabazz, an Ohio business owner formerly known as Jason Brooks, faces up to 177 years in federal prison after being indicted on multiple counts of fraud involving employee 401(k) retirement funds, investor capital, and a $220,000 mortgage scheme affecting victims across Greater Cleveland, the Times Reporter reported on October 12, 2026.
The Bottom Line
- Federal prosecutors charge Shabazz with embezzlement from an employee benefit plan, seven counts of wire fraud, three counts of engaging in monetary transactions in criminally derived property, and two counts of aggravated identity theft.
- Investigators allege Shabazz raised over $1.2 million in a Ponzi-style investment scheme centered on false promises regarding mortgage-lending ventures while withholding employee retirement contributions for personal and business expenses.
- Authorities state that Shabazz used stolen identities to secure a mortgage exceeding $220,000, leaving unsuspecting homeowners facing foreclosure notices before $97,000 of the loan proceeds were diverted to repay select 401(k) participants.
Indictment Details Across Greater Cleveland
The federal grand jury indictment outlines a complex web of financial misconduct spanning employee benefit plans and private investor funds in the Greater Cleveland area. According to federal prosecutors, Shabazz operated a wealth management firm where he routinely withheld employee 401(k) contributions. Instead of funding retirement accounts or executing required employer matches, authorities allege he funneled the capital directly into personal and business operating expenses.
Beyond the employee retirement plan violations, the indictment accuses Shabazz of raising more than $1.2 million from individual investors. These funds were reportedly secured through false representations regarding mortgage-lending ventures that failed to materialize as promised. FBI Cleveland Special Agent in Charge Joshua DelManzo stated in a release that Shabazz abused his position of trust and financially harmed employees and investors. “His tactics not only impacted the employees of the business, but also the Ponzi scheme and investment fraud victims. The FBI will continue to pursue fraudsters who choose personal gain over faithful stewardship of the funds in their care,” DelManzo said.
Mortgage Fraud and Stolen Identity Mechanics
The financial damage extended beyond corporate retirement accounts into residential real estate through identity theft. Prosecutors state that Shabazz used the personal identifying information of two individuals without their knowledge to secure a mortgage loan exceeding $220,000 against the victims’ home.
The targeted homeowners only discovered the fraudulent encumbrance after receiving formal foreclosure notices. According to investigative findings, approximately $97,000 of the illicitly obtained mortgage proceeds were subsequently redirected to partially reimburse participants in the stalled 401(k) scheme.
Potential Federal Prison Sentences
The federal charges carry severe cumulative maximum penalties under United States sentencing guidelines. Embezzlement from an employee benefit plan carries a maximum sentence of 5 years in prison. Each of the seven wire fraud counts carries a maximum penalty of 20 years in federal custody. Additionally, Shabazz faces three counts of engaging in monetary transactions in criminally derived property, each carrying up to 10 years, alongside two counts of aggravated identity theft, which carry a maximum of 2 years per count.
In total, the maximum statutory penalties reach 177 years in prison. Federal prosecutors emphasize that any final sentence will ultimately be determined by a federal judge should Shabazz be convicted at trial or enter a guilty plea.
Disclaimer: The information provided in this article is for educational and informational purposes only and does not constitute financial advice.
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