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Captive Insurance Expert Pleads Guilty to Aiding Solar Ponzi Scheme Leaders *Centurion Insurance AFS*

Feb 12, 2024 (0) comment , , , , , , , , , , ,



Remember the Carpoffs, the California couple sent to prison in 2021 and 2022 for running a $1 billion Ponzi scheme tied to mobile solar generators? The scheme that reportedly ensnared Warren Buffet’s Berkshire Hathaway and the Progressive insurance corporation?

A South Carolina attorney, known as a leader in setting up captive insurance programs and head of Hamilton Captive Management, has now pleaded guilty to helping Jeff and Paulette Carpoff hide millions of dollars from their fraudulent gains.

Peter J. Strauss, 45, of Beaufort, South Carolina, knowingly transferred as much as $11 million to a trust account in 2018 and 2019, shortly after federal agents searched the Carpoffs’ DC Solar and other businesses, the U.S. Attorney for South Carolina said in a statement. Strauss then improperly distributed much of the money to criminal defense attorneys, bankruptcy lawyers and to the Carpoff’s own captive insurance firm, the prosecutor said. Strauss pleaded to removal of property to prevent seizure, court records show.

“By pleading guilty, Strauss admitted that by the time of the $3 million transfer on Jan. 15, 2019, he knowingly transferred and aided and abetted the transfer of funds from Carpoff to prevent and impair the government’s lawful authority to take such property into its custody and control,” the U.S. Attorney’s Office said in its news release Friday.

Strauss has agreed to pay $2.7 million in restitution, but still faces up to five years in prison and $250,000 in fines. A sentencing date has not been set.

Strauss, who earned his law degree at New England School of Law, is the author of a number of books on captive insurance. Forbes magazine in 2017 called him one of the country’s top risk management attorneys.

His clients, the Carpoffs, gained nationwide fame when they were arrested then found guilty of perpetuating the alleged Ponzi scheme. Jeff Carpoff’s plan was to build mobile solar collectors that would provide clean, quiet electrical generators, according to the Robb Report and other news outlets. The idea caught on quickly, and investments began rolling in. Bloomberg news service reported in 2021 that Buffet’s Berkshire Hathaway and Progressive Corp. made sizable investments.

But prosecutors said much of the $2.5 billion in sales went to fund a lavish lifestyle for the Carpoffs, including homes, cars, a Minor League Baseball team and private concerts. Funds from new investors were used to pay earlier ones – a classic Ponzi scheme.

In late 2018, FBI and other law officers executed search warrants on DC Solar and associated firms, as well as the Carpoffs’ residences and bank accounts, the U.S. Attorney explained. The next day, the first $5 million was transferred to Strauss’ trust account, prosecutors said. Other transfers followed.

Jeff Carpoff was sentenced in 2021 to 30 years in federal prison. Paulette received an 11-year sentence.

Topics
Leadership
South Carolina

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