Lawyer: Businessman was used by polygamists in fraud scheme

In this photo provided by the Davis County Sheriff's Office shows Lev Aslan Dermen. Openings arguments are set Wednesday, Jan. 29, 2020, in Utah for a California businessman who prosecutors accuse of being a key figure in a $511 million tax credit scheme carried out by two executives of a Salt Lake City biodiesel company linked to a polygamous group. The men from the polygamous group pleaded guilty last year to money fraud and other charges and are expected to testify against Lev Aslan Dermen, who has pleaded not guilty. (Davis County Sheriff's Office, via AP)

SALT LAKE CITY, Utah – A California businessman accused of leading a nearly $500 million biodiesel fraud scheme was actually being used by a Utah polygamist who didn't want to share the proceeds with his community, a defense attorney said Thursday.

Polygamist Jacob Kingston previously pleaded guilty in the scheme and is now trying to shift the blame to businessman Lev Aslan Dermen, lawyer Mark Geragos said during opening statements at Dermen's federal trial in Salt Lake City.

Kingston was raised in a “toxic environment” where he learned to lie and carry out government fraud by an “incestuous” polygamous group that lives by what they call “bleeding the beast,” Geragos said.

“They deal in fraud. That is all they've ever done,” Geragos told jurors. “At the end of the day, you’ll find that all roads lead to Jacob Kingston.”

Dermen has pleaded not guilty to 10 counts, including money laundering and mail fraud.

Prosecutors painted a starkly different picture for jurors, saying Kingston and his brother teamed with Dermen two years into the scheme in exchange for protection by what Dermen called his “umbrella” of law enforcement and government sources.

Dermen pushed the Kingstons to expand the operation exponentially by using burner phones, elaborate money transfers through Turkey and Luxembourg and shipping fuels from countries such as Ireland and India through Panama, U.S. prosecutor Leslie Goemaat said during her opening statement .

Dermen told the others to launder the money by buying million-dollar luxury cars and houses, she said.