A California electrician was sentenced to three years in prison and ordered to pay $481.3 million in restitution Tuesday for his role in a $1 billion Ponzi scheme that conned Warren Buffet's Berkshire Hathaway Inc. and other companies, the Associated Press reported.
Prosecutors said that Joseph W. Bayliss, 46, was hired by the now shut down company DC Solar, which was based in Benicia, California. Though he was an electrician, he was asked to pose as a licensed engineer charged with inspecting mobile solar generator units on trailers, which the company marketed between 2011 and 2018 as capable of providing lighting at events and emergency power for cellphone companies, according to the AP.
However, DC Solar owners started advising investors that if they leased the generators back to the company, they would be able to profit from federal tax credits. DC Solar would then let other companies use the leased generators, according to prosecutors.
Prosecutors said that earlier investors into DC Solar were paid with money provided by newer investors, while the generators themselves never produced much profit, the AP reported. Generator production was ultimately halted completely, and prosecutors alleged that half of the company's reported stock of 17,000 generators was nonexistent.
Bayliss helped the scheme go unnoticed by covering up the fact that the company had stopped building generators, prosecutors said. Though he knew it was false and an effort to deceive DC Solar investors, he signed thousands of reports between 2016 and 2018 asserting that new generators had been inspected and tested.
He was paid about $1 million for this work, according to the AP.
For more reporting from the Associated Press, see below.
Prosecutors say Bayliss also shuffled vehicle identification numbers between the generators. And in 2018, after investigators served search warrants on the company, they say he went to a company warehouse in Nevada, destroyed at least 1,000 identification stickers and removed another 200 stickers from generators.
His sentencing comes a week after company co-owner Jeff Carpoff was sentenced to 30 years in prison and ordered to pay $790.6 million in restitution.
Carpoff and his wife, who also has pleaded guilty, used the money to buy and invest in 32 properties, more than 150 luxury cars, a subscription to a private jet service, a semipro baseball team, a NASCAR racecar sponsorship and a suite at the new Las Vegas Raiders stadium.
Four others have also pleaded guilty to related offenses and are awaiting sentencing.
Prosecutors wouldn't comment on the chances that Bayliss will pay all or even part of the massive restitution.
But court documents say he owes it jointly with Carpoff. The government already has seized more than $120 million worth of Carpoff's possessions to be used in partial restitution to victims.
So while Bayliss is accountable for the restitution until it's paid off, others in the case also are accountable.
Uncommon Knowledge
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Newsweek is committed to challenging conventional wisdom and finding connections in the search for common ground.
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Zoe Strozewski is a Newsweek reporter based in New Jersey. Her focus is reporting on U.S. and global politics. Zoe ... Read more
