Property, cash tied to fraud forfeited
September 23, 2020
Federal court order strips solar tax fraud family of 2,200 acres in county, $1.4 million from accounts
A federal judge last week ordered the family at the center of a wide-ranging, years-long tax fraud case to turn over thousands of acres of real property in Millard County as well as $1.4 million in cash to a court-appointed receiver.
U.S. District Judge David Nuffer signed the order Sept. 14 after weighing numerous legal objections, none of them successful, raised by the family in court over the last year.
The properties in question were titled in the name of Glenda Johnson, wife of Neldon Johnson, who along with other family members and associates orchestrated what the federal government alleged was a scheme using solar tax credits to defraud the national treasury of about $50 million. Court records in the case suggest the fraud stretched back to at least 2005.
A receiver was appointed in the case in 2018 to claw back the scheme’s ill-gotten gains, including homes, vehicles, cash and land, and auction the property off to recoup the government’s losses.
A court-appointed receiver, R. Wayne Klein, held an auction in 4th District Court in July 2019, selling a 75-acre parcel tied to the RaPower-3 solar tax fraud scheme.
Last year an iconic property—a 75-acre parcel at the heart of the scheme known locally for the skeletal remains of several “solar towers”—was auctioned off at the courthouse in Fillmore. Glenda Johnson placed a lien on that property and others already sold only to be slapped by the court for her effort and ordered to remove the liens earlier this year or face incarceration.
The court order last week clears the way for the receiver to now sell 11 properties in Millard County, totaling more than 2,200 acres of land, with a few structures, plus any accompanying water rights.
Three other properties were also cleared for sale, two in Utah County and a condominium in Los Angeles.
Two bank accounts containing funds allegedly transferred by Glenda Johnson—she served as bookkeeper for some of the key entities at the heart of the tax scheme—from companies profiting from the fraud was also handed over to the receiver.
One account contained more than $1.2 million. Another contained more than $200,000. The court ordered both the cash and any interest accumulated to be turned over within three days of the court filing.
“Glenda Johnson frequently issued checks to herself—from Receivership Entities—that she deposited in her personal bank accounts,” according to the court order.
More deadlines and a threat of arrest and the involvement of the U.S. Marshals Service were included in the court’s demands.
“Within seven days of this order, Glenda Johnson shall provide to the Receiver and file with the Court a declaration under oath listing all damage, other than ordinary wear and tear, that existed as of June 22, 2018 on any of the real properties that are the subject of the Turnover Motion,” one paragraph of the order states.
The order continues with a deadline of 14 days to transfer title to the properties and any associated water rights over to the receiver.
The court appointed receiver, R. Wayne Klein, said Monday that 12 of the 14 properties in question were placed under his control by last Friday. Funds from the two bank accounts were also wired to an account controlled by the receiver on Friday.
The judge allowed the Johnsons to choose one property— ostensibly their primary residence—to hold onto for the next 21 days before handing it over. This property could either be one at Sherwood Shores locally or a residence described in court records as the “West Mountain home.”
The occupants of a condominium in Payson were also given 21 days to vacate the property.
“Glenda Johnson, Neldon Johnson, LaGrand Johnson, and Randale Johnson are specifically prohibited and enjoined from entering the premises of any of the Turnover Properties after the date of this order,” except to retrieve personal items and any animals on the properties.
Klein said he expects to take possession of those properties by Oct. 6.
The Johnsons, who have been accused multiple times of flouting previous orders of the court, were specifically warned against any funny business, including that the U.S. Marshals Service is authorized to take any measures to remove anyone deemed in violation from any of the properties.
“The United States Marshals Service is authorized and directed to take any and all necessary actions, including but not limited to the use of reasonable force, to enter and remain on the premises, which includes, but is not limited to, the land, buildings, vehicles, and any other structures located thereon, for the purpose of executing this order,” the court filing states.
Anything left on the properties is considered abandoned and forfeited to the receiver. Any action to tarnish the market value of any of the properties is also considered a violation and subject to civil contempt proceedings, according to the court.
The receiver in the case was ordered to retain $100,000 from the future sale of a 3.46 acre parcel in Millard County once owned by the Oasis Seed Plant Cooperative—its market value was assessed this year at $211,765. The funds are to be retained pending ongoing litigation between the receiver and Glenda Johnson.
Klein said four additional properties alleged to have been purchased with ill-gotten gains are involved in that litigation.
Klein filed the civil lawsuit in federal court a year ago alleging Glenda Johnson fraudulently transferred as much as $5 million to herself from entities at the heart of the fraud scheme. After a smattering of back and forth motions in that lawsuit, no action has been recorded since February, possibly pending the outcome of the court’s slow work toward this most recent order.
Klein says he expects that case to continue.
The Millard County property, including several parcels with buildings and residences upon them, are expected to be ready for auction by the end of October. Klein said he will inspect the property, make any repairs necessary to retain value, have them appraised and then place them on the market.
The original article is here.