Sacramento, California - The owner of the Benicia-based company DC Solar was sentenced today for a $1 billion Ponzi scheme, the largest criminal fraud scheme in the history of the Eastern District of California. Acting for U.S. Attorney Phillip A. Talbert announced.
US District Judge John A. Mendez sentenced 50-year-old Martinez's Jeff Carpoff to 30 years in prison. On January 24, 2020, Carpoff pleaded guilty to conspiracy to commit wire fraud and money laundering. His wife, Paulette Carpoff, 47, also pleaded guilty to conspiracy to commit crimes against the United States and money laundering. The government’s investigation resulted in the forfeiture of approximately US$120 million in assets, and the government intends to seek authorization to use these assets to compensate victims of fraud.
According to court documents, between 2011 and 2018, DC Solar manufactured mobile solar generator sets (MSG), which are solar generators mounted on trailers and advertised as being able to provide emergency power and power to cell phone towers. Lighting for sports events. Due to the solar-powered nature of MSG, a major incentive for investors is a generous federal tax credit.
Conspirators use recurring payments similar to Ponzi schemes for accounting and lease income fraud. Carpoff and others lied to investors about DC Solar's MSG market demand and its revenue from third-party leases, and then used techniques such as false financial statements and false lease contracts to cover up these lies. Their fraudulent behavior obscured the recurring payment structure, in which Kapov and others simply used new investor funds to pay old investors the assumed rental income that investors expected. As DC Solar lost a lot of money due to this fraudulent model, Carpoff and other accomplices completely stopped manufacturing MSG and sold thousands of MSG that did not even exist to investors. In order to carry out this part of the fraud, Carpoff and others disguised MSG as a place where they did not exist, exchanged vehicle identification number (VIN) stickers on MSG made earlier, and tried to deceive certain investors during device inspections. In fact , Of the approximately 17,000 mobile solar generators claimed to be manufactured by DC Solar, at least half of them do not exist.
"Jeff Kapov planned the largest criminal fraud plan in the history of the Eastern District of California," said Acting U.S. Attorney Talbert. "He claims to be an innovator in alternative energy, but he actually just steals funds from investors and cost U.S. taxpayers hundreds of millions of dollars in tax credits. Today's substantive judgment reflects the seriousness of the crime and provides Just punishment. The U.S. Attorney’s Office is committed to protecting the public and promoting respect for the law."
Sean Ragan, the head of the FBI, said: “Kapov’s appalling plans fueled his greedy desire for luxury and prestige, including buying sports teams, high-end collector vehicles, international real estate, and NASCAR fleets. The Sacramento field office of the gorgeous public expenditures included. "I thank the committed FBI agents, forensic accountants, and professional staff who worked tirelessly with the IRS Criminal Investigation and the FDIC Office of the Inspector General to thoroughly investigate this complex case. Our office is committed to identifying and investigating financial fraud, and encourages the public to report suspected fraud to tips.fbi.gov. "
"Mr. Kapov lived a luxurious life as a successful businessman," said the agent of Mark H. Pearson, the person in charge. "In fact, he manipulated the system for profit by lying to investors, promising to provide large federal tax credits, and laundering his ill-gotten gains. The IRS criminal investigation will continue to work with our federal partners to ensure Anyone who participates in such a plan, no matter how big or small, will be held responsible for their crimes."
"Today's judgment recognizes the importance of holding Mr. Carpoff responsible for conspiring with others to defraud investors of approximately $1 billion by creating a fraudulent commercial enterprise and using the proceeds for the personal benefit of him and his wife," said Federal Deposit Insurance Jeffrey D. Pittano, Special Head of the Office of the Inspector General of the Company (FDIC OIG). "FDIC OIG is committed to working with our law enforcement partners to bring to justice those who undermine the integrity of the financial system."
The confiscation included the confiscation and auction of Carpoffs' 148 luxury and collector cars, including the 1978 Firebird previously owned by actor Burt Reynolds. The historical auction recovered approximately US$8.233 million. In addition to collecting luxury cars and collectible cars, Jeff and Paulette Kapov also used the funds from the program to pay for a minor league professional baseball team and NASCAR racing sponsorship; purchase luxury cars in California, Nevada, the Caribbean, Mexico and other places Real estate; subscription of private jet services; suites on professional football stadiums; and jewelry.
In addition to Carpoffs, five other defendants were also charged with criminal offences related to the fraud scheme: 46-year-old Martinez and 54-year-old Ronald J. Roach of Walnut Creek, each of whom pleaded guilty to the charges. October 22, 2019. Bayliss is set to pronounce its verdict on November 16, 2021, and Roach is set to pronounce its verdict on February 15, 2022. Robert A. Karmann of Clayton, 54, pleaded guilty to the charges on December 17, 2019; on January 14, 2020, Ryan Guidry, 44, pleaded guilty to the charges. 50-year-old Alan Hansen of Vacaville, a former employee of a telecommunications company that claims to have business dealings with DC Solar, pleaded guilty in July to February 28, 2020, participating in a fraud plan and Bribery of US$1 million to sign a false contract. Karmann, Guidry and Hansen are scheduled to be sentenced on December 14, 2021. Paulette Carpoff is scheduled to be sentenced on November 16, 2021.
This case is the result of investigations by the Federal Bureau of Investigation, the Criminal Investigation Bureau of the Internal Revenue Service, and the Office of the Inspector General of the Federal Deposit Insurance Corporation. Assistant US Attorneys Christopher S. Hales and Kevin C. Khasigian are prosecuting the case.
Paulette Carpoff, Hansen, Karmann and Guidry face statutory sentences of up to 15 years. Roach and Baylis face statutory penalties of up to 10 and 5 years respectively. However, the actual sentencing will be determined by the court at its discretion after considering any applicable statutory factors and federal sentencing guidelines, which take into account many variables.
https://www.justice.gov/disaster-fraud/video/psa-national-center-disaster-fraud
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