FRESNO - Ray Brewer, 66, of Porterville, and Sheridan, Montana, was sentenced today to six years and nine months in prison for running a multimillion-dollar fraud scheme where he purported to turn cow manure into green energy, U.S. Attorney Phillip A. Talbert announced.
According to court records, from March 2014 through December 2019, Brewer stole $8,750,000 from investors by claiming to build anaerobic digesters on dairies in Fresno, Kern, Kings, and Tulare Counties, as well as other counties in California and Idaho. Anaerobic digesters are large machines that use microorganisms to break down biodegradable material and turn it into methane. The methane can then be sold on the open market as green energy.
The methane also produces Renewable Energy Credits (REC), representing the property right to the reduction in greenhouse gas emissions achieved through green energy creation. Companies commonly purchase RECs to meet green energy regulatory, contractual, and initiative requirements or commitments. Brewer’s investors were supposed to receive 66% of all net profits and tax incentives.
Brewer made various misrepresentations to his investors. Brewer took investors on tours of dairies where he said that he would build the digesters and sent them forged lease agreements with the dairy owners. He also sent the investors altered agreements with banks, making it appear that he had obtained millions of dollars in loans to build the digesters. Moreover, he sent the investors forged contracts with multinational companies, making it appear he had secured revenue streams. Finally, he sent the investors fake pictures of the digesters under construction. None of this was true.
After Brewer received the investors’ money, he transferred the funds to multiple other bank accounts that he opened in the names of different entities, his family members, and an alias. He used false descriptions for the transfers. He did so to conceal the money's location, source, ownership, and control before using it for personal expenditures. These expenditures included two plots of land that were ten or more acres each, a 3,700-square-foot custom home, and new Dodge Ram pickup trucks.
Brewer subsequently told his investors that the digesters were progressing when that was not true. He sent them fake documents: construction schedules, invoices for project-related costs, power generation reports, RECs, and pictures.
In some instances, Brewer purported to refund investors all or some of their money. The refunds, however, came from newly received money from other investors who had not authorized Brewer to use their money in this way. When Brewer’s investors realized the fraud and obtained civil judgments against him, he moved to Montana and assumed a new identity.
Upon his arrest, Brewer told officers that they had the wrong man. He also claimed to have been in the Navy and recalled how he once saved several soldiers during a fire by blocking the flames with his body so that they could escape. Brewer has since admitted that these were both lies meant to curry favor with law enforcement.