Bookkeeper, former USC coach plead guilty in admissions scandal, promise to help investigators

An accountant who laundered bribes and a collegiate soccer coach who pocketed them pleaded guilty in Boston on Thursday to racketeering conspiracy, acknowledging they played key roles in a scheme that defrauded some of the country’s most prestigious universities.

Steven Masera, an accountant from the Sacramento suburb of Folsom, kept the books for the Key Worldwide Foundation, a charity that claimed to help low-income children but did little more than funnel money from wealthy parents to coaches who misrepresented their children as recruited athletes, and to test proctors who let them cheat on their entrance exams.

Some parents deducted the five- and six-figure bribes from their tax bills, prosecutors alleged.

Ali Khosroshahin, who led the USC women’s soccer program from 2007 to 2013, recruited four students to his program who had never played soccer in a competitive setting, prosecutors say. In exchange, Khosroshahin took more than $200,000 in bribes from William “Rick” Singer, the admitted architect of the test-fixing and bribery scam that exploded into public view in March.

Fifty people have been charged with fraud and money laundering crimes by the U.S. attorney in Massachusetts, including 33 parents from some of the country’s wealthiest enclaves and some of its most lucrative and influential industries.

Both Masera and Khosroshahin have signed cooperation agreements, promising to tell prosecutors what they know of the scam in hopes of receiving leniency when they are sentenced. Masera will be sentenced Oct. 22; Khosroshahin, Oct. 25. Should any of the 28 defendants who have maintained their innocence go to trial, Masera and Khosroshahin could be called to testify against them.

Prosecutors recommend that Masera, 69, spend about five years in prison, according to his plea agreement and federal sentencing guidelines. They recommend Khosroshahin, 46, be imprisoned for about four years and forfeit $209,000, the sum he reaped from Singer’s scheme.

In deciding the first sentence of the case earlier this month, U.S. District Judge Rya W. Zobel spared John Vandemoer prison, despite prosecutors recommending the former Stanford sailing coach be incarcerated for 13 months. That proposal was less than the range given in Vandemoer’s plea deal, but Zobel disputed the government’s sentencing calculus and went far below that recommendation.

Vandemoer, who also pleaded guilty to racketeering conspiracy, avoided prison despite having no formal cooperation deal. Masera and Khosroshahin, however, have brokered such agreements. If prosecutors decide either of the men helped their investigation substantially, they could ask a judge to sentence them below the ranges laid out in their plea deals.

Khosroshahin was fired by USC in 2013 but continued to work with Singer, facilitating a bribe payment in 2016 to Jorge Salcedo, then the men’s soccer coach at UCLA, according to an indictment charging Salcedo with racketeering conspiracy. Salcedo has pleaded not guilty.

In his plea agreement, Khosroshahin promised to file accurate tax returns with the Internal Revenue Service for years when he didn’t file or filed inaccurately. He also agreed to make a “good-faith effort” to pay delinquent taxes and other penalties.

As the Key Worldwide Foundation’s accountant and financial officer, Masera issued scores of euphemistic invoices to Singer’s clients, prosecutors say, such as the $10,000 bill for “testing support” to a Northern California couple who wanted to inflate their daughter’s SAT score by 320 points, or the $200,000 tab for “placement fees” to a Del Mar executive whose daughter was admitted to USC as an ersatz soccer player.

Masera sent Mossimo Giannulli an invoice in 2017 for a $200,000 charitable “pledge” one week after the fashion designer’s older daughter received an acceptance letter from USC. Giannulli told Masera he was vacationing with his family in the Bahamas, but he would “gladly” settle up when he returned to California, according to a complaint charging Giannulli with fraud conspiracy.

Along with his wife, actress Lori Loughlin, Giannulli has since been indicted on an additional charge of money laundering conspiracy. They have pleaded not guilty.