Last December the FBI raided the home and business of DC Solar founder Jeff Carpoff in California’s Bay Area, seizing well in excess of a million dollars in cash and a collection of over 140 automobiles—valued over $4 million—in relation to a massive charge of fraud. The allegations, to which an involved electrician and CPA have plead guilty, include what prosecutors call a $2.5 billion Ponzi scheme.
Jeff and his wife Paulette, former owners of the now-defunct portable solar panel company, are at the center of the investigation, though they are not named in documents or charged in the case as of yet. Here’s some clarification from the Sacramento Bee:
But court documents make it clear that investigators are targeting an alleged conspiracy through their company, which offered investors huge federal tax incentives to lease mobile solar generators that could be used at racetracks and concerts and to power remote cell phone towers during power outages.
Losses to investors are estimated at $1 billion, court papers say.
From the U.S. Attorney’s Office:
“The company solicited investors by claiming that there were very favorable federal tax benefits associated with investments in alternative energy. The company structured the transactions in order to maximize the tax benefits to the investors.
“Investors would buy the (mobile solar generators) without ever taking possession of them. They would pay a percentage of the sales price and finance the balance with the company. Then the investors would lease the MSGs back to the company, which in turn leased them to third parties. A portion of the lease revenue would be used to pay the investors’ debts to the company and to the investors. The third‑party leases, however, generated little income and the company paid early investors with funds contributed by later investors.”
Carpoff has always been an avowed automotive geek, having previously cut his teeth in business with a massive Jaguar and Land Rover repair shop called Roverland USA. He started out as a simple auto mechanic and really could have had a serious business on his hands if he hadn’t resorted to (alleged) fraud. And against clients as high profile as Warren Buffett, no less.
The couple spent over $40 million on a series of 25 lavish properties, including a large Las Vegas home, two condos in Lake Tahoe, and a vacation home in Scottsdale. Not to mention a minor-league baseball team, a box in the Las Vegas Raiders’ new stadium, jewelry, and $19 million in private jet shares with NetJets.
The seized collection is a strange one. It includes a number of Chevrolet and Mopar muscle cars from the late 60s and early 70s, as well as a number of modern performance sedans and sports cars. As well as a “Million Dollar Mustang” and a massive Prevost RV which cost several hundred thousand dollars. You know, the kind of thing you’d expect a new-money NASCAR sponsoring Ponzi scheming (allegedly) car dork to buy.
What you don’t expect is a selection of ex-military AM Generals to be parked alongside a collection of microcars. A 1964 Austin Mini, a Nash Metropolitan, six Fiats, and a trio of Autobianchi Bianchinas (!!!). The Eastern District California U.S. Attorney dismissively refers to this section of the collection as “small little put-put cars”.
It’s an impressive collection by size, but not in its ability to capture my interest. It seems a little too staid, really. Take some risks. I mean, who needs to own four different Eleanor-style 1967 Mustang Fastbacks?
If you’re interested in checking out the auction, 149 lots are currently listed on the Apple Towing auction site.
According to the U.S. Attorney, the proceeds will go to pay back the people who were allegedly defrauded. You know, assuming they find the Carpoffs guilty. If they are not found guilty, the cash will be handed back to them and they’ll presumably be free to buy the cars back all over again.
It feels a little weird to me to auction off the cars before people who aren’t even named in the court case are found guilty. Isn’t there a presumption of innocence until guilt is proved? Anyway, if you want a deal on a Ciquecento or one of the four Mopar wing cars, here’s your chance.