Jacob Kingston, testifying against his former co-defendant for a fifth day, says he sent about $30 million in fraud proceeds to the polygamous sect to which he belongs, the Davis County Cooperative Society.
“That’s what Isaiah and I allocated,” he said on Wednesday, referring to his brother, Isaiah Kingston, the chief financial officer of Washakie Renewable Energy. Jacob Kingston was the CEO.
“When Isaiah and I would do our budgets for the year,” Kingston added a moment later, “we would decide what was extra, and that’s what was allocated to The Order.”
“The Order” or the Kingston Group are other names for the cooperative society.
(Courtesy Davis County jail) Lev Aslan Dermen, also known as Levon Termendzhyan, a suspect in a fraud scheme, poses for this mug shot from 2018
Kingston is a prosecution witness against Lev Aslan Dermen, who the federal government says became the driving force behind Washakie’s efforts to defraud a U.S. government biofuel program. Federal prosecutors contend Washakie received $470 million in fraudulent payments.
Dermen seldom came up Wednesday. Defense attorney Mark Geragos spent the day asking Kingston more about his family and about frauds that started as early as 2008, about three years before Kingston met Dermen.
Geragos asked about text messages Kingston sent his brother Isaiah almost a decade ago saying that their uncle and the top man in The Order, Paul Kingston, expected to receive $100 million from the fraud.
On the witness stand, Kingston said the $100 million expectation was only a rumor relayed to him through one of his plural wives’ father. (That father is also Jacob Kingston’s uncle.) Kingston said he was under no obligation to give that amount to The Order or its leader.
Kingston said he doesn’t know how much of the $30 million that was paid to The Order went to Paul Kingston.
(Francisco Kjolseth | The Salt Lake Tribune) Defense attorneys Setara Qassim, left, and Mark Geragos arrive for the final day of jury selection at the federal courthouse in Salt Lake City, Wednesday, Jan. 29, 2020, in the trial of Lev Dermen, who is charged with 10 felonies related to fraud at Washakie Renewable Energy.
Geragos has contended that Jacob Kingston and his family were the real fraudsters and money launderers. Geragos also has asked Jacob Kingston questions about interfamily marriages in The Order. Jacob Kingston acknowledged Wednesday he and Isaiah Kingston both married cousins.
To recoup the government’s losses, federal prosecutors have moved to seize all of Washakie’s assets as well as the homes and businesses of other people, who apparently have connections to the Kingston Group but did not participate in the fraud. Real estate records show that these people received fraud proceeds via a financial firm. This seizure includes 25 homes and businesses and lots in Salt Lake County that the assessor says have a combined market value of $14.4 million.
Even before he met Dermen, Jacob Kingston testified Wednesday, Washakie had executed frauds with other biofuel companies in New York, Colorado and Washington.
“So you’ve got coast-to-coast frauds,” Geragos said. “Did you ever say, ‘This is amazing that I’ve got these same frauds on different coasts?’”
“I never put that together,” Kingston replied.
Dermen, 53, is charged in federal court in Salt Lake City with 10 counts: two counts of conspiracy and eight counts of money laundering. He faces up to 180 years in prison. Jacob and Isaiah Kingston have both pleaded guilty to crimes. The cross-examination will resume Thursday.
Belize politician steps down
(Image via Belize Ministry of National Security) Belize Minister of National Security John B. Saldivar inspects security facilities according to a press release Dec. 14, 2019.
Belize Security Minister John Saldivar resigned as leader-elect of the country’s governing party Wednesday, and the prime minister suspended him from the Cabinet. Both events happened a day after prosecutors in Dermen’s trial showed the jury text messages between Kingston and Saldivar.
In the texts, Saldivar asked Kingston for $50,000 to fund political campaigns. Kingston agreed to send a courier to Miami to pay the money.
The news release from Belize Prime Minster Dean Barrow said he asked Saldivar to resign as leader-elect of the United Democratic Party, a post that put Saldivar on track to succeed Barrow.
The indefinite suspension, Barrow said, will “give the minister a chance to prove the innocence which he strongly maintains; it will also give time for the government to obtain official transcripts from the trial and direct the police to launch and complete a thorough investigation into all the allegations made in the course of that Dermen trial.”
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