A hefty jail sentence was handed out this week in Martinez, CA. What has been said was the biggest criminal fraud in the history of the Eastern District of California, Acting U.S. Attorney Phillip A. Talbert announced to local news outlets. The scheme, which involved Jeff Carpoff, 50 of DC Solar, a Benicia-based company, was a complex honeycomb involving notable investment firms such as Warren Buffett's Berkshire Hathaway.
Below is a quote from Claycord.com Reporting:
The conspirators carried out an accounting and lease revenue fraud using Ponzi-like circular payments. Carpoff and others lied to investors about the market demand for DC Solar’s MSGs and its revenue from leasing to third parties, then covered up these lies with techniques including false financial statements and fake lease contracts. Their fraud concealed a circular payment structure where Carpoff and others were simply using new investor money to pay older investors the supposed lease revenue that investors were expecting. As DC Solar lost vast sums of money with this fraudulent model, Carpoff and other conspirators stopped building the MSGs altogether, selling thousands of MSGs that did not even exist to investors. To carry out this part of the fraud, Carpoff and others made it appear that MSGs existed in locations that they did not, swapped vehicle identification number (VIN) stickers on MSGs that had been built earlier, and attempted to deceive certain investors during equipment inspections. In reality, at least half of the approximately 17,000 mobile solar generators claimed to have been manufactured by DC Solar did not exist. “Jeff Carpoff orchestrated the largest criminal fraud scheme in the history of the Eastern District of California,” said Acting U.S. Attorney Talbert. “He claimed to be an innovator in alternative energy, but he was really just stealing money from investors and costing the American taxpayer hundreds of millions in tax credits. Today’s substantial sentence reflects the seriousness of the offense and provides just punishment. The U.S. Attorney’s Office is committed to protecting the public and promoting respect for the law.”
Carpoff was handed a 30 year sentence and ordered to pay restitution. The defendant forfeited approximately $120 million in assets. His wife Paulette Carpoff is also facing a potential 15 years in prison for her involvement in the scheme. During the timeframe from 2011-2018, Carpoff had purchased millions in luxury real estate, a NASCAR sponsorship, and even a minor league baseball team.
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