Lev Aslan Dermen, also known as Levon "The Lion" Termendzhyan, was convicted of conspiring with members of a polygamous sect in Utah known as "The Order" in one of the most audacious tax frauds in history.
He was found guilty after a seven-week trial of conspiracy to commit mail fraud, conspiracy to commit money laundering and money laundering.
Dermen was a Bel Air billionaire and gas station tycoon when he joined forces with members of the polygamous Kingston clan.
According to the Department of Justice, court documents and testimony from Dermen's 2020 trial show that from 2010 to 2018, Dermen conspired with various members of the Kingston family to fraudulently claim more than $1 billion in refundable renewable fuel tax credits.
The IRS ultimately paid out more than $511 million in credits to Washakie Renewable Energy, a Utah biodiesel company owned by Jacob and Isaiah Kingston.
The Kingstons distributed the fraud proceeds among themselves and Dermen, the DOJ said.
Jacob Kingston, 46, took a plea deal and testified against Dermen, telling jurors they had more money than they could launder, so they started buying luxury items like Lamborghinis and Bugattis along with private jets, yachts and mansions in Turkey, Utah and Huntington Beach.
Prosecutors said Dermen employed a team of corrupt law enforcement officers, including former DHS Agent Felix Cisneros, former Glendale detective John Balian and former FBI Agent Babak Broumand.
In addition to the prison sentence, Dermen was ordered to pay $442,615,520 in restitution to the IRS and imposed a money judgment of more than $181 million against him.
Jacob Kingston, who was co-owner and CEO of Washakie, was ordered to pay $511 million in restitution to the IRS. The court also imposed a $338 million money judgment against him. He was also sentenced Friday to 18 years in prison.
"The significant sentences imposed by the court reflect the breathtaking scope of the defendants' nearly decade-long tax fraud scheme - one of the largest ever," said Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department's Tax Division. "Dermen and members of the Kingston family cost law-abiding taxpayers more than $500 million and attempted to steal double that. They also sought to cover their tracks by cycling billions-of-dollars in transactions through the banking system and using fuel purchases and oil tankers to give the illusion their plant was actually producing and selling biodiesel fuel eligible for IRS credits. Tax Division prosecutors and IRS-CI Special Agents not only unraveled this scheme - they uncovered, traced and recovered millions in proceeds secreted in Turkey, the United States and elsewhere."
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