Four members of a family with ties to a polygamist group have pleaded guilty in a fraud case that involved claiming false tax credits worth more than $500 million for their renewable energy company in Box Elder County, ending a federal case that has been ongoing for nearly a year.
In a plea agreement reached on Friday, July 19 in U.S. District Court in Salt Lake City, Jacob Kingston pleaded guilty to a litany of charges that include tax fraud, mail fraud, conspiracy and witness intimidation. He could spend as much as 30 years in federal prison.
Jacob Kingston’s brother, Isaiah Kingston, along with his wife, Sally Louise Kingston and his mother, Rachel Ann Kingston, also took plea deals in the case that has been ongoing for the past 11 months.
A fifth defendant in the scheme, California businessman Lev Aslan Dermen, still faces trial for his role.
Jacob and Isaiah Kingston are the founders of Washakie Renewable Energy, a biofuels company in Plymouth. In the plea deal struck earlier this month, Jacob Kingston said he and the other defendants began claiming false tax credits for the company in 2010, claiming far more biofuels production than the plant was actually producing.
Court documents state that the Kingstons attempted to claim more than $1 billion in false tax credits, but were stopped at $511 million after officials uncovered the scheme.
The two brothers are the sons of John Daniel Kingston, one of the leaders of the polygamist group The Order, also known as the Davis County Cooperative Society.
On Aug. 24, 2018, both Kingston brothers were indicted and arrested, along with Lev Aslan Dermen, 52. The Kingstons and Dermen were indicted by a federal grand jury out of Salt Lake City’s U.S. District Court and court documents released to the public detail the allegations of fraud including that $511 million in renewable energy tax credits was fraudulently obtained but more than $1.1 billion was attempted in the scheme. Since then even more charges have been filed.
On Nov. 20, 2018, Jacob Kingston was charged with 14 counts of filing false tax returns and 11 counts of money laundering while Isaiah Kingston was charged with seven counts of money laundering.
Federal officials charged Rachel Kingston, the brothers’ mother, and Sally Kingston, the wife of Jacob Kingston, with felony charges on Jan. 22, in U.S. District Court in Salt Lake City.
The woman were accused of assisting the men to bilk over $1 billion from the U.S. government with false claims to obtain tax credits with biofuel transactions. The company obtained $511 million before officials stopped the scheme.
Rachel Kingston was charged with attempted conspiracy to commit mail fraud, money laundering, bank fraud and obstruction of justice by destroying records. Sally Kingston faces charges of fraud and money laundering.
Court documents state that the three men used WRE as a front to file false claims for those tax credits from 2010 to 2016. The company was established in 2007 as a biofuels production plant with a 40,000-square-foot plant in Plymouth and
headquarters in Salt Lake City.
Court documents added that the Kingstons and Dermen falsified company records including sales invoices, accounting records and weren’t manufacturing all the biofuel they were claiming on records to collect tax credits. They also added that money was funneled through Dermen’s company.
In those documents it added that the Kingston brothers spent millions of dollars on a home in Sandy, Utah, and a Bugatti Veyron sports car worth over $1 million, among other purchases during a spending spree in 2013. They also bought property in Belize, where they planned to build a casino, and in Washington state for a marijuana growing operation.
In the latest documents, Kingston stated that he met Dermen in 2011, and that Dermen helped him grow the conspiracy by setting up biofuels transactions using false paperwork. He also stated that Dermen instructed him to funnel millions of dollars in false tax credit’s to Dermen’s native country of Turkey.
He said Dermen told him they would be protected by authorities in Turkey, and that he began to file for false credits in “larger and larger amounts.”
Kingston also said he was tipped off in 2016 that federal raids were coming, allowing him and his co-defendants to destroy evidence ahead of the raids.
The U.S. Attorney’s office also stated in the report that the men used burner phones and other means of communication during the time of the alleged fraud.
Washakie Renewable Energy claims on their website to produce biofuels from “renewable, clean-burning diesel replacement from locally grown crops and recycled waste.” Jacob Kingston and Isaiah Kingston each owned 50 percent of WRE, reports state, and that the company was listed as one of the largest producers of biodiesel and chemicals in the intermountain west.
This isn’t the first time the Kingstons have faced allegations in connection with Washakie Renewable Energy. In 2017, Jacob Kingston and WRE lost a judgement in civil court between them and LifeTree, a New York based biofuels company, on allegations that Jacob Kingston and WRE fraudulently defaulted on a $90 million contract.
In 2015, WRE was ordered to pay the Environmental Protection Agency $3 million in civil fines. In 2016, the Internal Revenue Service raided other businesses in connections with the entire Kingston family.
The Kingston brothers initially pleaded not guilty on Aug. 24, 2018, but reversed course in this month’s plea deal. As part of the deal, Jacob Kingston also agreed to hand over the WRE plant and property in Plymouth.
Following the plea deal, Jacob and Isaiah Kingston remain in jail while they await sentencing. Rachel and Sally Kingston remain free, and no sentencing date has been set yet.
Dermen recently attempted to have his trial be severed from that of the Kingstons, but that motion was denied. Dermen awaits sentencing while being held in the Davis County Jail.
In keeping with the spirit of the people who founded Tremonton, the Bear River Valley Museum participated in this year’s City Days celebration with a pioneer workshop featuring candle making, yarn spinning and other activities recognizing the city’s pioneer heritage.
Women donned full-length dresses, bonnets and other pioneer garb to capture the feel of days gone by. One table featured handmade wooden toys, and another nearby served as a quilt tying station.
Visitors to the museum last Friday afternoon, July 26, were greeted just inside the entrance by Judean Parkinson, who is originally from the Bear River Valley and brought her own spinning wheel from her home in Cedar City.
Parkinson made casual conversation with visitors as she expertly worked the treadle, the name for the pedal that spins the wheel, with her foot while her hands worked the spindle. Spools of already spun yard sat waiting on a “lazy Kate” to be combined into thicker strands.
“That’s where the term ‘spin a yarn’ comes from,” Parkinson said. “Ladies used to get together and spin and share all the local gossip. ‘Spin a yarn’ became code for sharing juicy gossip.”
She started spinning when she still lived in the Bear River Valley, and found an elderly woman in Beaver Dam who had mastered the craft to teach her, but the woman passed away after Parkinson’s first lesson about 10 years ago.
After moving to Cedar City, she found a group through the local museum that was into spinning yard and continued her learning. She also picked up some knowledge while serving an LDS mission in Nauvoo, Illinois.
She says spinning is gradually becoming a lost art, as there aren’t as many young people learning the old ways, but it has been making a comeback of sorts in recent years.
“You can hand-spun yarn now in craft stores,” she said. “It costs more, but people really like it because it isn’t perfect, it’s not so uniform. It has more personality, and people love that.”
Some of the people she knows in the Cedar City area take things a step farther, making yarn from wool they get from their own sheep that they raise, and making dyes from local wildflowers.
The museum also took the opportunity to showcase a vintage spinning wheel it recently acquired. The refurbished, working spinning wheel was purchased online for $75, and new parts were an additional $138. Southern Utah Wood Turners did repairs and restoration, free of charge.
The repairman, from Cedar city, was so overwhelmed with the old wheel, he commented, “This is a well-used spinning wheel. It has been my privilege to work on it.”
Museum board members welcomed the donation of labor and appreciated the cost savings. Even the acquisition of a spinning wheel in the twenty-first century was a lesson in pioneer thriftiness and the generosity of a stranger.
Parkinson showed the extensive wear at the spot where the wheel is attached to the frame.
“You can see it has been used a lot,” she said. “The guy who worked on said he thinks it could be from the 1600s.”
Parkinson said yarn spinning is a hobby that helps relieve stress while putting her in touch with her pioneer roots, all while creating a useful craft product that can be made into rugs, blankets, clothing or any number of handy items.
“It’s something that helps keep history alive,” she said.
School is almost back in session, and with that it means back-to-school shopping for students.
However, not all can meet the demand for new clothes, backpacks and school supplies in northern Box Elder County. With that in mind, staff and students at Bear River Middle School will be hosting their annual Swap n’ Shop clothing event Aug. 2-3, at the Tremonton LDS Stake Center located at 660 N. 300 E. in Tremonton.
On Friday, Aug. 2, doors will be open from 11 a.m. to 7 p.m. and Saturday from 9 a.m. to 7 p.m.
Donations are still greatly needed and can be dropped off anytime during those hours on those two days or at the Leader office, 2 East Main Street, Tremonton, on Wednesday, July 31, and Thursday, Aug. 1, from 9 a.m. to 3 p.m.
The event is a service project that started with Jamie Kent, a former administrator at BRMS about five years ago. Since then Kacee Udy, a teacher at BRMS and advisor to the student council, as well as Kelli Rose, a counselor at BRMS and Shamra Nielsen, a teacher at the school have organized the event. All of them, as well as members of the BRMS student council, spend hours and hours sorting through clothes and organizing them into sizes to get the event ready for the community.
“When we first did it, it was here at the school for two hours,” Udy said.
“And that wasn’t enough,” added Rose.
They moved the clothing swap to the stake center down the street from Bear River High and kept it going for two full days. The response they received was phenomenal.
“There was not one minute during the entire two days that there were not people in there looking for clothes,” Udy said.
Taking that success, and the need in the community for more clothing swaps, the school hosted a Christmas clothing and gift swap last December. It turned out to be even bigger than the back-to-school swap.
That event was just a one day swap with the addition of donations of new and gently used toys. They will continue that swap again this year.
“It was so successful,” Udy said. People generously donated to the swap and not just used items, but new ones, too.
Donations for this week’s swap are low and they are encouraging people to clean out their closets for a good cause. Udy added that they are low on children’s clothes, size five and smaller, and school supplies this year.
“We would love small clothes because people come in for that too,” she said.
Donations of gently used clothes in infant to adult sizes are accepted as well as backpacks (new or used) and school supplies. Any and all are invited to shop and donations aren’t required to shop and take home clothes or school supplies. One helpful favor they ask is for donations to be divided by size to help save time, but that isn’t required.
“We’ll gladly take whatever,” Udy said.
“And we don’t mind sorting,” added Nielsen
After the event is over, members of the Bear River lacrosse team volunteer to help clean up, a service they greatly appreciate.
“We have a lot of people that come up to us and say thank you,” Udy recalled. Many of them weren’t able to afford new school clothes for their children.
“The more we do it, the more people look forward to it,” said Rose.
They estimated they served 300 to 500 people and it doesn’t matter what their income or situation is.
“Anybody can come,” Udy said.
“It’s free and it doesn’t cost anything,” added Nielsen.
“Our community is really generous but there’s also a huge need,” Udy said.
A man died after being hit by a semi truck on I-15 in Tremonton, Utah, last week in what authorities are calling a suicide.
At about 2 p.m. Thursday, July 25, local police and fire agencies responded to the scene of an accident in the northbound lanes just south of where I-15 and I-84 split. Utah Highway Patrol spokesman Sgt. Nick Street said a young male jumped in front of a semi truck and was killed instantly.
He said the driver of the semi wasn’t injured and apparently didn’t do anything wrong. The incident remains under investigation.
The northbound lanes were closed for about an hour and a half between mileposts 376 and 378 while responders were on the scene, and traffic was diverted through Tremonton. Motorists reported traffic that was backed up four miles or longer south of the Elwood exit until the freeway was reopened around 3:45 p.m. Thursday.
Street said the age of the deceased could be anywhere from the late teens up to 30 years old. He said the body was intact and “a loved one would be able to identify this person,” but no identification was found with the body.
“We’re hoping to identify him through missing persons claims or by relying on fingerprint records,” Street said.
Thursday’s incident was the second such occurrence in Box Elder County in the last six weeks. On June 14, a 22-year-old California man was killed when he walked in front of a semi on I-15 northbound near Willard Bay.
“In Utah, it’s sadly a common way that people are ending their lives,” Street said.