Sun, Jan 26, 2020 - Page 5 News List

US couple admit US$1bn solar scam

‘SMOKE AND MIRRORS’:The couple’s forfeited assets recovered over US$8m that will be returned to victims. Authorities have returned US$500m to the US Treasury

AFP, WASHINGTON

US Attorney for the Eastern District of California McGregor Scott looks over a 2007 Ford Shelby GT500 displayed in Sacramento, California, on Oct. 23 last year that was among vehicles seized by the federal government to be auctioned off. The cars belonged to owners of a San Francisco Bay Area solar energy company that have pleaded guilty to participating in what federal prosecutors called a massive Ponzi scheme.

Photo: AP

An American couple pleaded guilty to running a US$1 billion solar investment scam that they used to finance a luxury lifestyle, including buying Burt Reynolds’ sports car, US authorities announced on Friday.

The California husband-and-wife team was taking money from investors for nonexistent mobile solar generators, which they used to buy a 1978 Firebird that once belonged to the late Hollywood star, luxury homes in the Caribbean and Mexico, jewelry and a baseball team, according to a statement.

They were charged in a wide-ranging case involving the FBI, Internal Revenue Service, Securities and Exchange Commission and other agencies.

‘PONZI SCHEME’

“By all outer appearances this was a legitimate and successful company,” said Kareem Carter, special agent in charge at IRS Criminal Investigation.

“But in reality it was all just smoke and mirrors — a Ponzi scheme touting tax benefits to the tune of over US$900 million,” Carter said.

According to court documents, between 2011 and 2018, their company, DC Solar, manufactured mobile solar generator units (MSG), that were mounted on trailers and used to provide emergency power to cellphone towers and lighting at sporting events.

Investors were lured in by the promise of generous federal tax credits for solar power and earnings from leases on the units.

NOT REALLY THERE

However, authorities said at least half of the approximately 17,000 solar generators they claimed the company manufactured did not exist.

The conspirators created false financial statements and obtained false lease contracts, among other efforts to conceal the fraud.

Jeff Carpoff, 49, of Martinez, pleaded guilty to conspiracy to commit wire fraud and money laundering and faces up to 30 years in prison, according to the statement.

His wife, Paulette Carpoff, 46, pleaded guilty to conspiracy to commit an offense against the US and money laundering.

A federal judge is due to decide their sentence on May 19.

US Attorney McGregor Scott said the couple forfeited US$120 million in assets, including 148 luxury and collector cars, which recovered over US$8 million that will be returned to victims.

Authorities have returned US$500 million to the US Treasury to date, he said.

Four associates of the couple previously pleaded guilty to federal criminal charges related to the fraud scheme since October.

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