Nov. 10--A Newport Beach man was sentenced Monday to two years in federal prison after he pleaded guilty to a wire fraud charge in connection with a multimillion-dollar scheme to peddle bogus In-N-Out Burger franchises in the Middle East.
In addition to the prison term, U.S. District Judge Andrew J. Guilford sentenced Craig Stevens to three years of supervised release after he completes his prison sentence, according to the U.S. attorney's office in Los Angeles.
Stevens, 55, was charged with wire fraud in April after prosecutors say he began hawking In-N-Out franchises to investors abroad via e-mail. Each franchise cost a flat rate of about $150,000, with additional money from royalties, according to court records.
All told, Stevens solicited nearly $4.3 million from about 10 investors, according to the charging documents filed by federal prosecutors.
The wire fraud charge, prosecutors had contended, stemmed from Stevens sending a fake In-N-Out licensing agreement in June 2014 via e-mail to an unidentified Lebanese investor.
Since 1948, In-N-Out Burger Inc. has been privately owned, and no such franchise agreements or partnerships with outside parties exist, prosecutors said. The Irvine-based company has locations in six U.S. states -- California, Nevada, Arizona, Utah, Texas and Oregon -- and on its website, the company said it has no plans to expand outside that territory.
Stevens entered his guilty plea on June 29. He has remained out of custody on a $10,000 bond and is expected to begin his prison term in January 2016.
Ron Cordova, the attorney representing Stevens, could not be reached for comment.
