FARMINGTON — A wealthy California businessman wants to be released from the Davis County Jail to the custody of his private security guards, but federal prosecutors warn that the fraud suspect would flee to Turkey.
Lev Aslan Dermen, one of three defendants in an alleged $511 million renewable energy tax credits fraud, has asked U.S. District Judge Jill Parrish of Salt Lake City to release him on bail pending trial.
Mark Geragos, a Los Angeles attorney defending Dermen, filed court papers Wednesday requesting that Dermen be released to the custody of Guidepost Solutions LLC, which would be hired to hold the suspect under house arrest in his California residence.
Geragos said Guidepost would install security cameras and alarms, and armed guards would be present around the clock. The employees are former, retired, and off-duty federal and state law enforcement officers, he said.
But the U.S. Attorney’s Office in Utah filed an objection Thursday, urging Parrish to keep Dermen locked up in Farmington.
“It is entirely unclear how a private security service retained and paid for by the defendant could possibly be relied upon to ensure his appearance in court,” the prosecutor’s office said in a court document.
“There is simply no way to prevent the defendant from being able to make his escape through intentional or negligent conduct by Guidepost employees, and in that event, there is no way how Guidepost, a private security company, could be held accountable for the escape by the court or the government.”
Prosecutors alleged Dermen has millions of dollars in assets and investments in Turkey that came from money illegally obtained in the tax fraud scheme.
Further, they said Dermen in the past failed to show up for numerous court depositions and “has demonstrated his willingness to make use of his vast resources, including a private jet,” to flee to Turkey in 2016 when FBI agents raided Utah businesses seeking evidence in the fraud case.
“The United States agrees with Mr. Dermen insofar as he concedes that around-the-clock surveillance by armed security is necessary to ensure his appearance in court,” the prosecution document said.
But, prosecutors said, Dermen’s bid to get out of jail “does not appear to contemplate ‘release’ so much as it describes a very expensive form of private jail or detention.”
They added, “Allowing the defendant to avoid (jail) by funding his own private detention is unreasonable because it helps to foster inequity and unequal treatment in favor of a very small cohort of criminal defendants who are extremely wealthy.”
Dermen is officially in the custody of the U.S. Marshals Service. The agency contracts with county jails to hold federal suspects pending trial.
Dermen’s co-defendants, Jacob and Isaiah Kingston, are held in the Weber County Jail. The federal court had denied them bail, citing a risk they would flee to Turkey.
Jacob Kingston was arrested in August as he and his family prepared to bound a plane bound for Turkey, prosecutors said, adding that the Kingston brothers both had millions invested in Turkey, which does not extradite criminal suspects to the United States.
The Utah brothers are members of The Order, an organization led by polygamist members of the larger Kingston clan, which has extensive business holdings in Utah and the West.
The brothers are the owners of Washakie Renewable Energy, which has a large biofuels production plant near Plymouth in Box Elder County.
Prosecutors said the Kingstons and Dermen conspired to obtain tax credits, payable in cash, from the federal government for renewable biofuels production via Washakie and other companies controlled by the three men.
They are charged with multiple counts, including money laundering and aiding and abetting the filing of false tax returns. The Kingston brothers also destroyed evidence, worked to intimidate potential witnesses and tried to bribe a federal employee, prosecutors said in court documents.
Prosecutors alleged the Kingstons and Dermen falsified sales invoices and accounting records, plus production records, blending tickets, bills of lading and other paperwork routinely created in qualifying for renewable fuel transactions.