US DOJ Targets Beverly Hills Mansion In Alleged Defence Contract Money Laundering Scheme

The US Department of Justice (DOJ) has filed a civil forfeiture complaint seeking to seize a Beverly Hills mansion allegedly purchased and renovated with around $30 million in proceeds from a defence procurement fraud, foreign bribery and money laundering scheme.

The complaint, filed in the US District Court for the Central District of California on 22 April 2026, alleges that a Virginia-based defence contractor and others obtained more than $700 million from the US Department of Defense’s Defense Logistics Agency (DLA) for fuel deliveries to the US military during Operation Inherent Resolve, the campaign against Islamic State of Iraq and Syria.

According to the DOJ, the scheme centred on fuel deliveries at Erbil International Airport in Kurdistan, a key delivery point for jet fuel used by US and coalition forces in Iraq and Syria. Prosecutors allege that officers of the contractor agreed to pay General Mansour Barzani, a senior Peshmerga official, a bribe of $0.25 per litre in exchange for exclusive access to deliver jet fuel in Kurdistan.

The DOJ claims that competitors were blocked from accessing Erbil International Airport for DLA jet fuel deliveries, while the contractor received one-time-buy contracts at non-competitive and significantly inflated prices. Funds allegedly obtained through the scheme were later transferred to NYJD Trust No 1, a Virginia trust established for Barzani’s private benefit.

In 2018, around $30 million was allegedly transferred from the trust to purchase the Beverly Hills mansion and fund renovations and improvements between 2019 and 2022. The forfeiture action seeks to recover the property as alleged proceeds of fraud, bribery and money laundering offences.

The case highlights the DOJ’s continued use of civil asset recovery powers to target high-value property linked to foreign corruption and procurement fraud. It also underlines the enforcement risk facing defence contractors operating in conflict zones, where access controls, local intermediaries and urgent procurement needs can create elevated bribery and money laundering exposure.

For compliance teams, the case is a reminder that government contracting, third-party access arrangements, beneficial ownership structures and high-value real estate purchases remain key areas of scrutiny for US enforcement agencies.

Read the press release here.