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2 Utah Polygamous Group Members Plead Guilty In Tax Scheme

Weber County Sheriff's Office

Two executives of a Salt Lake City biodiesel company linked to a polygamous group have pleaded guilty to charges filed in what prosecutors have called a $511 million tax credit scheme, according to documents made public Friday.

Washakie Renewable Energy once described itself as the largest producer of clean burning and sustainable biodiesel in Utah, but prosecutors said the company was actually creating fake production records to get renewable-fuel tax credits, then laundering the proceeds from 2010 through 2016.

Prosecutors plan to seize items including a $3.6 million home in Huntington Beach, California, as well as a Bugatti and Lamborghini as a result of the pleas.

Company CEO Jacob Kingston pleaded guilty Thursday to more than three dozen counts, including mail fraud, money laundering and obstruction of justice. His brother and company CFO Isaiah Kingston pleaded guilty to more than a dozen similar counts.

Prosecutors have said both men are members of the northern Utah-based Davis County Cooperative Society, also known as the Kingston Group, which practices polygamy and owns hundreds of businesses. Group leaders have condemned fraudulent business practices.

The money was used to buy houses and property in Turkey and Belize as well as Utah and Arizona, according to plea documents.

Among the homes set to be seized is an upscale six-bedroom house in a Salt Lake City suburb owned by Jacob Kingston that is valued at $4 million, according to county property records. Another home is the multimillion-dollar luxury waterfront property in California.

Prosecutors are also seizing other cars and cash.

The mother of the two men, Rachael Kingston, also pleaded guilty Thursday to charges including mail fraud and money laundering, as did Jacob Kingston's wife Sally. They are accused of helping the men rotate the same fuel between tanks in Texas, Louisiana and Panama to create the false appearance of buying biodiesel, then helping them launder the money and purge records.

Defense attorneys for all four members of the Kingston family did not immediately return messages seeking comment, or declined to comment.

Jacob Kingston also had an unidentified contact who tipped him off ahead of a federal raid 2016, allowing the brothers to remove their hard drives from their computers and one belonging to their mother, according to plea documents.

A fifth person charged in the case, California businessman Lev Aslan Dermen, has pleaded not guilty to charges including mail fraud and money laundering. That hasn't changed, his lawyer Mark Geragos said.