Oregon Man Sentenced After $65 Million Online Sneaker Scam

EUGENE, Ore. (Jan. 8, 2026) — The former owner of Zadeh Kicks LLC, a now-defunct Oregon company that sold limited edition and collectible sneakers online, was sentenced to federal prison on Tuesday for his role in a sweeping fraud conspiracy that left customers out more than $65 million in unfulfilled orders and defrauded financial institutions of over $15 million.

Michael Malekzadeh, 42, of Eugene, was sentenced to 70 months in federal prison, followed by five years of supervised release. He was also ordered to forfeit more than $15 million in assets. Restitution will be determined at a later date.

“This million-dollar fraud was fueled by the defendant’s insatiable greed and wreaked havoc on the lives of his victims and their families—delaying home purchases, retirements, and engagements,” said Scott E. Bradford, U.S. attorney for the District of Oregon. “Michael Malekzadeh fed his lavish lifestyle by cheating his customers, collectors, and investors out of millions and defrauding banks. The sentence imposed today reflects the seriousness of these crimes and should serve as warning to anyone contemplating fraud as a get-rich-quick scheme.”

“While the defendant lived in luxury, he took money from kids and adults for goods he was never going to deliver,” said Acting FBI Portland Special Agent in Charge Stephanie Shark. “In this case, part of the cost of his crimes are the unfulfilled desires of individuals who trusted him with their money. It is a good reminder that when transactions require us to rely on those who we do business with; it is important to do whatever we can to also verify they can deliver what they promise. Investigating fraud and deception in our communities remains an FBI priority.”

“The devastating effects of financial crime are real, as Mr. Malekzadeh’s greed harmed many lives,” said Special Agent in Charge Carrie Nordyke of IRS Criminal Investigation’s Seattle Field Office. “The consequences for financial crime are equally as real however, as shown in Mr. Malekzadeh’s sentencing. IRS-CI is committed to protecting our communities from financial fraudsters.”

According to court documents, Malekzadeh launched his business in 2013 by purchasing limited edition and collectible sneakers to resell online. Beginning as early as January 2020, Zadeh Kicks offered customers the option to preorder sneakers ahead of public release dates, allowing Malekzadeh to collect payments before fulfilling orders. Prosecutors said he advertised, sold and accepted money for preorders despite knowing he could not satisfy all of the orders. By April 2022, Malekzadeh owed customers more than $65 million in undelivered sneakers.

Authorities said Malekzadeh also conspired to submit false and altered financial information to multiple financial institutions, including altered bank statements, on more than 15 bank loan applications. Through those applications, Malekzadeh and a co-conspirator obtained more than $15 million in loans.

During the investigation, agents seized millions of dollars in cash and luxury goods purchased with fraud proceeds, including high-end watches, jewelry and hundreds of handbags. Nearly $7.5 million was also seized from the sale of Malekzadeh’s Eugene residence, his watches and luxury vehicles manufactured by Bentley, Ferrari, Lamborghini and Porsche.

Malekzadeh was charged by criminal information on July 29, 2022, with wire fraud, conspiracy to commit bank fraud and money laundering. He pleaded guilty on March 20, 2025, to wire fraud and conspiracy to commit bank fraud.

As part of their plea agreements, Malekzadeh and his co-conspirator agreed to pay restitution in full to their victims. A restitution hearing is scheduled for March 31, 2026.

The case was investigated by the FBI, IRS Criminal Investigation and Homeland Security Investigations, with assistance from the Oregon Intellectual Property Task Force. It is being prosecuted by Assistant U.S. Attorney William M. McLaren. Forfeiture and restitution proceedings are being handled by the U.S. Attorney’s Office Asset Recovery Unit.