SALT LAKE CITY — A co-defendant in the Kingston biofuels fraud case has been held in maximum security since July after authorities said they needed to prevent him from tampering with witnesses, court records show.
While in the Davis County Jail, Lev Aslan Dermen, 53, improperly used other inmates’ phone access PIN numbers to make calls outside the jail, the U.S. Attorney’s Office said in a July 30 court filing.
Further, through an intermediary jail visitor, Dermen and fellow defendant Jacob Kingston, who is held in the Salt Lake County Jail, exchanged “coded” communication, prosecutors said.
The supposed coded conversation “included references to Miami, Florida, where a cooperating witness, previously threatened by Kingston, lives,” the prosecutors’ document states.
Prosecutors said that after the “threats or perceived threats,” the witness quit cooperating with the prosecution.
Despite acknowledgments that the witness tampering reports needed further corroboration, prosecutors convinced U.S. District Judge Jill Parrish to order Dermen moved to maximum security pending his Sept. 9 trial on conspiracy, fraud and money laundering charges.
Kingston and Kingston’s brother Isaiah, mother, Rachel, and wife, Sally, recently pleaded guilty to charges in a $511 million scheme in which federal renewable energy tax credits were claimed fraudulently over about a 7-year period.
Kingston, who faces up to 30 years in prison when he is sentenced, is expected to testify in Dermen’s trial, according to a prosecution document filed Monday.
Prosecutors said Kingston will testify that Dermen promised him early on during the biofuels scheme that he would protect him from prosecution with a network of corrupted current and former law enforcement personnel.
Dermen also used the protective umbrella as a “sword” with which to threaten Jacob Kingston to comply with Dermen’s wishes during the scheme, they said.
“Kingston will testify that Dermen regularly slapped him and others as a show of dominance,” the prosecution document states.
Kingston also will testify that after he told Dermen a relative had been assaulted by a hotel employee in Turkey, Dermen had the man bound to a chair and beat him, according to prosecutors.
Regarding an alleged incident in 2014, “Kingston will testify that Levon offered to have ‘his guys’ ‘take care of’ a journalist who wanted to reference polygamy,” the document said.
The Kingstons are members of a polygamist organization known as The Order or the Davis County Cooperative Society.
In their plea bargains, Jacob and Isaiah Kingston acknowledged that their Washakie Renewable Energy company was used as a vehicle to carry out the biofuels tax credit fraud scheme with a storm of faked invoices, records and fictitious fuel shipments.
In a flurry of litigation since the Kingstons pleaded guilty, Dermen’s lawyers have been contesting their client’s detention and challenging the admissibility of witnesses the government plans to call during the trial.
Dermen was arrested in September 2018 and was held without bail in the Davis jail in Farmington until last month.
The U.S. Marshals Service, which contracts with county jails to hold pretrial prisoners, reported that the wealthy Dermen had put $15,000 into his commissary account at the Davis jail.
By acquiring phone PIN numbers from other inmates, Dermen could make multiple calls, prosecutors said.
“This practice makes it impossible for (jailers) to review communications of Dermen and monitor for possible threats,” prosecutors said.
Marshals transferred Dermen to the Salt Lake jail on July 29 and he was placed in maximum security. His attorneys soon filed documents challenging the close detention, arguing it is now hindering his constitutionally protected discussions with his trial attorneys.
Meanwhile, prosecutors have signaled that they may identify additional alleged conspirators in the biofuels case during Dermen’s trial.