Wife of California solar Ponzi scheme exec sentenced to prison in nearly $1 billion fraud

Seven months after a federal judge in Sacramento sentenced solar Ponzi-scheme defendant Jeffrey Carpoff to 30 years in prison, the same judge sentenced Carpoff’s wife, Paulette, to 11 years and three months for what prosecutors called a fraud that led to “a gluttonous accumulation of wealth.“

“I’m truly sorry and ashamed of the impact of the whole situation,” the 48-year-old defendant told U.S. District Judge John A. Mendez as she wiped away tears. “I’m truly sorry.”

Paulette Carpoff pleaded guilty in January 2020 to conspiracy to commit an offense against the United States and money laundering and could have faced up to 15 years in prison.

But her defense attorney, William Portanova, said she has cooperated with federal investigators in ongoing probes, and officials said she had been working with investigators as recently as Monday.

“This is a dark day for the Carpoff family, but it’s a day she’s had coming for quite a while,” Portanova said after court. “She will continue to unravel the damage this scheme has wrought on people throughout the country.”

Carpoff was ordered to pay more than $661 million in restitution and surrender to begin her prison term by Aug. 23.

She served as chief operating office of DC Solar Solutions and participated with her husband and other company officials in what federal prosecutors say was a nearly $1 billion fraud scheme, the largest in the history of the Sacramento-based Eastern District of California.

The couple used the money derived from the scheme to invest in lavish collections of automobiles, high-end vacation properties and sports ventures.

“This included luxury real estate in Lake Tahoe, Las Vegas, the Caribbean, and Cabo San Lucas, over 150 luxury and collector vehicles, a private subscription jet service, lavish jewelry, and massive amounts of cash stashed throughout their home, office, and cars,” Assistant U.S. Attorney Christopher Hales wrote in the government’s sentencing memorandum. “The nature and circumstances of Carpoff’s crimes deserve a substantial sentence.”

Prosecutors say Benicia-based DC Solar offered investments in the firm, which manufactured mobile solar generators for use at concerts, racing events and other venues, but that the Carpoffs covered up the fact that leases of the generators fell short of what was needed to keep the company afloat.

So, prosecutors say, they simply siphoned off huge amounts of cash from investors to try to keep DC Solar going and enrich themselves until the scheme collapsed.

“As hundreds of millions in investor money poured into DC Solar because of the fraud, Carpoff’s financial empire with her husband exploded,” Hales wrote. “Among other things, they formed six LLCs to purchase various properties, bought over 150 luxury and collector vehicles, bought a suite at the Las Vegas Raiders professional football stadium, invested in a minor-league baseball team ... and bought expensive jewelry including items such as Cartier watches and a 4.52-carat diamond necklace.

“They also lived their lives stuffed to the brim with cash. When search warrants were executed in this case in December 2018, law enforcement found over $18,000 in Carpoff’s purse, another over $18,000 in the master bedroom, over $22,000 in a safe in the master bedroom closet, and over $9,000 in cash in the Carpoffs’ vehicles parked at their residence.”

Another $1.7 million in cash was found in Jeffrey Carpoff’s office safe, court papers say.

Portanova filed court papers that included several letters from family members, including Carpoff’s 51-year-old husband, who is serving his term at a federal lockup in Victorville and wrote that she is “a wonderful person that made some bad decisions.”

“Simply put I don’t deserve her,” he wrote. “She has been the most loving person I have ever known and only hope that we can live through these years to be together again.

“She has taught me so many things I can’t possibly write them all down. I know that she has deep regret for this position she is in and would never intentionally hurt anybody. Paulette has been the most caring and nurturing wife a guy could ever ask for. She has made it her life mission to be the best wife and mother she could possibly be. I know the things we have done were wrong but please take into consideration the wonderful person she is and has been.”