Hassan Nemazee, an Iranian-American businessman who raised money for the political campaigns of Barack Obama and Hillary Clinton, was sentenced to 12 years in prison for defrauding Bank of America Corp, Citigroup Inc and HSBC Holdings Plc out of $292 million.

U.S. District Judge Sidney Stein imposed the sentence on Thursday following Nemazee's March 18 guilty plea in Manhattan federal court to charges of bank fraud and wire fraud over loan transactions with the three major banks.

Nemazee said he needed the money to pay debts arising from his dealings in hedge funds and properties.

You know exactly what you have done, Stein told Nemazee during the sentencing proceeding. I don't think there is any fooling yourself by yourself. You have done a great deal of good in your life and yet Stein said, this crime is breathtaking in its brazenness and its scope.

Nemazee was one of the top bundlers of contributions to Obama's 2008 presidential campaign, according to the Center for Responsive Politics' OpenSecrets.org. He typically donated more than $100,000 annually to Democrats including Clinton, now U.S. secretary of state.

The judge allowed Nemazee, 60, to remain free on bail under strict conditions of home confinement until he reports to a prison on August 27. In addition to 12 years imprisonment and three years of supervised release, Stein ordered Nemazee to make $292.3 million in restitution to the banks.

I am guilty of these frauds. I am also guilty of hypocrisy, said Nemazee, a U.S. citizen whose family left Iran after the 1979 revolution.

The businessman, who once also ran a private equity firm, Nemazee Capital Corp, said he had violated the moral standards he had taught his children and others to abide by.

Nemazee's sentence of 12 years was less than the term of between 15-1/2 years and 19-1/2 years sought by U.S. prosecutors.

In attempt to explain to the court why he deceived his family and friends, the gray-haired, dapper Nemazee said, I spent countless hours trying to understand why and how I came to cross the line.

Pride, ego, self-image, self-importance are among the reasons I traveled down this destructive path.

Nemazee admitted to obtaining hundreds of millions of dollars in loans from the banks by using fake documents to show supposed ownership of collateral.

His brother-in-law, Shahin Kashanchi, of Telluride, Colorado, has been charged in the case with regularly manufacturing statements for the nonexistent collateral accounts. Kashanchi, who owned a business that installed home electronic equipment, has pleaded not guilty to a charge of bank fraud. His case is pending but no trial date has been set.

Nemazee was a former member of the board of the Iranian American Political Action Committee, whose website says it contributes to candidates for public office in the United States regardless of party affiliation. It works to support Iranian American candidates and issues important to that community such as immigration reform, combating discrimination and support for the community's small businesses.

The case is U.S. v Nemazee, U.S. District Court, Southern District of New York, No. 09-00902.

(Reporting by Grant McCool; Editing by Matthew Lewis, Phil Berlowitz)

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