Jeff Carpoff, Billion Dollar Ponzi Scheme, California 2020

SACRAMENTO, Calif. — A Benicia-based company owner, Jeff Carpoff, was sentenced today for a billion-dollar Ponzi scheme—the biggest criminal fraud scheme in the history of the Eastern District of California, Acting U.S. Attorney Phillip A. Talbert announced.

U.S. District Judge John A. Mendez sentenced Jeff Carpoff, 50, of Martinez, to 30 years in prison. On Jan. 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 an offense against the United States and money laundering.

The government’s investigation has resulted in approximately $120 million in assets forfeited that the government intends to seek authorization to use towards restitution to victims of the fraud.

According to court documents, between 2011 and 2018, DC Solar manufactured mobile solar generator units (MSG), which were solar generators that were mounted on trailers and were promoted as able to provide emergency power to cellphone towers and lighting at sporting events. A significant incentive for investors were generous federal tax credits due to the solar nature of the MSGs.

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.

“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.”

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