Couple behind billion-dollar DC Solar ponzi scheme forfeits stake in Napa winery in plea deal

The "Follow This Story" feature will notify you when any articles related to this story are posted.

When you follow a story, the next time a related article is published — it could be days, weeks or months — you'll receive an email informing you of the update.

If you no longer want to follow a story, click the "Unfollow" link on that story. There's also an "Unfollow" link in every email notification we send you.

This tool is available only to subscribers; please make sure you're logged in if you want to follow a story.

Please note: This feature is available only to subscribers; make sure you're logged in if you want to follow a story.


SACRAMENTO — The owners of North Bay solar energy company pleaded guilty Friday to charges that they plotted a massive Ponzi scheme that defrauded investors of $1 billion.

As part of their plea deal, prosecutors said the husband and wife team from Martinez agreed to forfeit over $120 million in assets, including a stake in Whetstone Wine Cellars in Napa’s Atlas Peak winegrowing region, a fleet of collector cars and vacation homes in the Caribbean, Lake Tahoe and Las Vegas purchased entirely with cash.

Jeff Carpoff, 49, pleaded guilty to conspiracy to commit wire fraud and money laundering, which carry a maximum penalty of up to 30 years in prison, the U.S. Attorney’s office in Sacramento said.

Paulette Carpoff, 46, pleaded guilty to conspiracy to commit an offense against the United States and money laundering and faces up to 15 years in prison.

Prosecutors said the Carpoffs began DC Solar, based in Benicia, as a legitimate company that made solar generators mounted on trailers and marketed them as able to provide emergency power for cellphone companies or to provide lighting at sporting and other events. The company inked lease deals for about 260,000 square feet of Benicia commercial space in 2011, 2012 and 2016, according to North Bay Business Journal reporting.

However, court papers alleged the company morphed into a Ponzi scheme by telling investors they can take advantage of federal tax credits by leasing the generators back to DC Solar, which would then provide them to other companies for their use. Two related DC Solar companies filed for liquidation in January 2019 after law enforcement raids a month before, according to public records and the plea agreement document.

The investors were supposed to be paid with the profits, but the generators never provided much income. Instead, prosecutors said early investors were paid with funds from later investors.

Prosecutors alleged that the company engaged in $2.5 billion in investment transactions between 2011 and 2018, costing investors $1 billion. Among the investors was Warren Buffett’s Berkshire Hathaway Inc., which lost some $340 million.

“By all outer appearances this was a legitimate and successful company,” Kareem Carter, special agent in charge of IRS Criminal Investigation. “But in reality it was all just smoke and mirrors — a Ponzi scheme touting tax benefits to the tune of over $900 million.“

The Carpoffs used the money from the scheme to buy and invest in more than 150 luxury cars, 32 properties, subscription to a private jet service, a semipro baseball team and a suite at the new Las Vegas Raiders stadium.

The forfeited money will be returned to investors, prosecutors said.

Four others have pleaded guilty in connection with the scheme. They included a general contractor, an accountant and the former vice president of operations for DC Solar.

A seventh co-conspirator is scheduled to plead guilty on Feb. 11.

North Bay Business Journal contributed to this report.

Show Comment

Our Network

Santa Rosa Press Democrat
Sonoma Index-Tribune
Petaluma Argus Courier
Sonoma Magazine
Bite Club Eats
La Prensa Sonoma
Emerald Report
Spirited Magazine