DC Solar founders to plead guilty to charges related to $1 billion Ponzi scheme
Thirteen months after the Federal Bureau of Investigation and Internal Revenue Service raided the headquarters of DC Solar and the home of its founders, Jeff and Paulette Carpoff, the couple has entered plea agreements related to a $1 billion Ponzi scheme, the impact of which saw Chip Ganassi Racing close its Xfinity Series program in 2019.
Jeff Carpoff has agreed to plead guilty to one count each of wire fraud and money laundering while Paulette Carpoff will plead guilty to one count each of conspiracy and money laundering.
According to the plea agreements filed with the Eastern District of California, the government will recommend an initial sentence of 30 years in prison for Jeff Carpoff and 15 years for Paulette Carpoff prior to any co-operation they provide with the case.
The agreement outlines a Ponzi scheme that operated from March 2011 to December 2018, ending with the raids on the Carpoff’s residence in Martinez, California, and DC Solar’s headquarters in Benicia, California.
DC Solar was a company that built and leased solar energy equipment and also sponsored Chip Ganassi Racing in the Cup and Xfinity Series. It was the primary or co-primary sponsor for Kyle Larson in 16 Cup races and for three races with Jamie McMurray in 2018. It also sponsored 10 Xfinity races with Ganassi and announced in November 2018 it would sponsor Ross Chastain’s full-time ride in 2019.
It also sponsored Xfinity Series races in 2018 at Phoenix Raceway and Las Vegas Motor Speedway and the infield “FanGrounds” at Richmond Raceway.
In the wake of the raids and the company filing for bankruptcy in January 2019, CGR was forced to close its Xfinity operation.
During the nearly eight-year scheme, the plea agreement says the Carpoffs used the money generated from it to buy their NASCAR sponsorships, 150 luxury and collectible vehicles and luxury real estate in Lake Tahoe, Las Vegas, the Caribbean and Mexico.
They also purchased a suite at a professional football stadium, a subscription private jet service, the Martinez (California) Clippers minor league baseball team and a 2018 performance by an internationally known rapper at a company holiday party.
Funds were also used to make illicit payments to their co-conspirators and others.
As part of their respective plea agreements, the Carpoffs have agreed to pay restitution to their victims, totaling between $800 million and $1.6 billion.