New Jersey Man Sentenced to 6.75 Years in Prison for Schemes to Steal California Unemployment Insurance Benefits and Economic Injury Disaster Loans
FRESNO, Calif. — Ray Brewer, 66, of Porterville, and Sheridan, Montana, pleaded guilty today to wire fraud, money laundering, and identity theft charges for running a multimillion-dollar fraud scheme where he purported to turn cow manure into green energy, U.S. Attorney Phillip A. Talbert announced.
According to court records, from March 2014 through December 2019, Brewer stole $8,750,000 from investors by claiming to build anaerobic digesters on dairies in Fresno, Kern, Kings, and Tulare Counties, as well as other counties in California and Idaho. Anaerobic digesters are large machines that use microorganisms to breakdown biodegradable material and turn it into methane. The methane can then be sold on the open market as green energy. The methane also produces Renewable Energy Credits (REC), which represent the property right to the reduction in greenhouse gas emissions achieved through green energy creation. RECs are commonly purchased by companies to meet green energy regulatory, contractual, and initiative requirements or commitments. Brewer’s investors were supposed to receive 66% of all net profits as well as tax incentives.
Brewer made various misrepresentations to his investors. Brewer took the investors on tours of dairies where he said that he was going to build the digesters and sent them forged lease agreements with the dairy owners. He also sent the investors altered agreements with banks that made it appear as though he had obtained millions of dollars in loans to build the digesters. Finally, he sent the investors forged contracts with multinational companies that made it appear as though he had secured revenue streams. None of this was true.
After Brewer received the investors’ money, he transferred the funds to multiple other bank accounts that he opened in the names of different entities, his family members, and an alias. He used false descriptions for the transfers. He did so to conceal the location, source, ownership, and control of the money before using it for personal expenditures. These expenditures included two plots of land that were 10 or more acres each, a 3,700 square foot custom home, and new Dodge Ram pickup trucks.
Brewer subsequently told his investors that the digesters were progressing when that was not the case. He did so by sending them fake construction schedules, fake invoices for project-related costs, fake power generation reports, fake RECs, and fake pictures.
In some instances, Brewer purported to refund investors all or some of their money. The refunds, however, came from newly received money from other investors who had not authorized Brewer to use their money in this way. When Brewer’s investors realized the fraud and obtained civil judgments against him, he moved to Montana and assumed a new identity. He later claimed to have been wrongfully arrested before admitting who he was.
This case is the product of an investigation by the Internal Revenue Service, Criminal Investigation, the Federal Bureau of Investigation, and the Social Security Administration Office of Inspector General. Assistant U.S. Attorneys Joseph D. Barton, Henry Z. Carbajal III, and Alyson A. Berg are prosecuting the case.
Brewer is scheduled to be sentenced on June 26, 2023, by U.S. District Judge Jennifer L. Thurston. Brewer faces a maximum statutory penalty of 20 years in prison and a fine of $250,000 for the wire fraud conviction. He also faces a maximum statutory penalty of 20 years in prison and a fine a of $500,000 or twice the amount of money involved for the money laundering conviction, whichever is the greater. Finally, he faces a mandatory two years in prison, consecutive to other counts, for the aggravated identity theft conviction. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.