The co-owner of a solar energy firm in the San Francisco Bay Area was sentenced to 30 years in jail Tuesday for orchestrating an elaborate Ponzi scheme that duped investors of $1 billion, including Warren Buffett's Berkshire Hathaway Inc.
This is the largest criminal fraud operation in the history of the federal court district covering inland Northern California, according to Acting United States Attorney Phillip Talbert.
DC Solar, founded by Jeff Carpoff, manufactures mobile solar generators for athletic events and music festivals. It bolstered its investor appeal by embellishing the actual number of generators it manufactured.
Huge amount of investments flowed in via intricate transactions known as tax-equity funds. Buffett's company made a $340 million investment. East West Bancorp, Progressive Corp., Valley National Bancorp, and Sherwin-Williams Co. were also investors.
Carpoff, 50, was meted with the maximum penalty in January last year after pleading guilty to conspiracy to commit wire fraud and money laundering.
His wife, Paulette Carpoff, 47, faces up to 15 years in jail after pleading guilty to money laundering and conspiracy to conduct an act against the United States governement at the same time.
The pair agreed to forfeit more than $120 million in assets, which included a collection of vintage vehicles and vacation properties in the Caribbean, Lake Tahoe, Mexico and Las Vegas that were acquired solely with cash.
Prosecutors stated that they want to utilize the assets to provide partial reparation to fraud victims.
Five additional individuals with ties to the corporation have also entered pleas of guilty in connection with the case.
Prosecutors said the couple founded DC Solar, situated in Benicia, as a legal business that manufactured solar generators mounted on trailers.
Between 2011 and 2018, they marketed the generators as being capable of providing emergency power to telecommunication companies or illumination at sporting and other events.
The prosecutors added that the U.S. government has recovered around $120 million in misappropriated assets that it plans to refund to investors.
Prosecutors said, however, that the owners began informing investors that they could get federal tax credits by leasing the generators back to DC Solar, which would then lease them to other businesses.