On October 5, 2023, Ari J. Lauer, a 59-year-old attorney from Lafayette, California, was indicted by a federal grand jury. The indictment comprises 23 counts and charges him with conspiracy, bank fraud, and wire fraud related to a massive fraudulent scheme in the Eastern District of California. The announcement was made by U.S. Attorney Phillip A. Talbert.
Lauer, who provided legal counsel to DC Solar from 2009 to January 2019, was arrested, and the indictment was unsealed on the same day.
DC Solar, between 2011 and 2018, produced mobile solar generators mounted on trailers, promoting them as environmentally friendly solutions for emergency power needs, including cellphone towers and event lighting. Investors were lured by generous federal tax credits due to the solar nature of the generators. However, the heart of the fraud involved investors never taking actual possession of the generators. Instead, DC Solar leased the generators back from investors and falsely claimed to sublease them to third parties to generate revenue, even though there was minimal demand from actual third-party renters.
Lauer and others in the conspiracy concealed the lack of third-party lease revenue by transferring investor funds among accounts and creating a circular payment system known as “re-rent.” They also crafted “re-rent agreements” and “concealed addendums” to defraud investors. In total, investors and financial institutions invested approximately $912 million in this scheme, involving around 17,000 generators.
The investigation involved the FBI, IRS Criminal Investigation, and the FDIC Office of Inspector General, and the case is being prosecuted by Assistant U.S. Attorney Audrey Hemesath.
Notably, others involved in the scheme have already been sentenced, with Jeff Carpoff receiving a 30-year prison term and being ordered to pay restitution, his wife Paulette Carpoff receiving an 11-year sentence, and other co-conspirators receiving various prison sentences and restitution orders. Ronald J. Roach, who also pleaded guilty, is awaiting sentencing, facing a maximum of 10 years in prison. The final sentence will be determined by the court based on various factors and sentencing guidelines.
By FCCT Editorial Team
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