Carissa Carpenter sold her dream for nearly 20 years, traveling the nation in search of investors who handed over millions of dollars to be part of a world-class movie studio and development project that would be environmentally friendly and employ thousands.
She pitched the idea from El Dorado Hills to South Carolina to Lathrop and, finally, Dixon, the small Solano County farm town west of Sacramento where eager city officials signed on for what she described as a $2.8 billion project that would lure some of the biggest names in Hollywood.
On Thursday, however, Sacramento-based U.S. Attorney Ben Wagner’s office said the whole deal was a fraud, that Carpenter had siphoned off more than $5 million from investors to support her luxurious lifestyle and had lied to investors and the FBI.
“Carpenter falsely represented to investors that all or substantially all of their investment would be used to fund the studio project,” stated a nine-page federal grand jury indictment unsealed Thursday in Sacramento, one day after authorities arrested Carpenter in the Los Angeles suburb of Venice. “In truth and in fact, Carpenter did not use all or substantially all of the investor money to fund the construction of the studio project.
“Instead, Carpenter used money from investors for her own personal expenses and to support her extravagant lifestyle.”
The FBI probe began weeks after a Sacramento Bee investigation of Carpenter found she had been taking money for years from well-heeled investors for her studio plans but had never built anything.
Instead, she left behind a 20-year trail of liens, civil suits, judgments and unpaid debts as she moved from town to town pitching her studio idea. The Bee found that Carpenter, a 51-year-old former Sacramento-area resident, had been the target of more than $1.4 million in court-ordered judgments and a lawsuit settlement, including debts from bounced rent checks, breached contracts and unpaid medical bills, since 1990.
In an interview last year, Carpenter denied any wrongdoing and said she was on the precipice of securing the financing for the Dixon deal through her company, Morning View LLC.
But that plan fell apart following The Bee’s revelations. By July 2013, Carpenter allegedly had lied to FBI agents interviewing her about her activities, according to the indictment, which lists 32 felony counts of wire fraud, mail fraud and making false statements to federal agents. If convicted, she could face up to 20 years in prison and be fined twice as much as what was lost in the alleged scheme.
Carpenter, who did not respond to a request for comment left on her cellphone, was released from custody in Los Angeles on $25,000 bail and ordered to appear in court in Sacramento on Nov. 20.
Over the years, prominent individuals have been swept into her orbit – including Sacramento attorney Robert W. Naylor, a former state legislator and past chairman of the state Republican Party. Naylor became Carpenter’s Morning View attorney and appeared at public meetings as he helped her negotiate studio proposals with the city of Dixon, and Vallejo before that.
On Thursday, as word of her indictment spread, few of her supporters wanted to talk about the case.
“I have no comment,” Naylor said quickly when reached by cellphone, then hung up.
Dixon Mayor Jack Batchelor and City Manager Jim Lindley, who enthusiastically embraced Carpenter’s plans, did not respond to requests for comment.
Dan Broadwater, business manager of the International Brotherhood of Electrical Workers Local 180, which supported the effort and planned to invest in it, declined to talk in detail Thursday about Carpenter’s arrest, saying he was too busy. Her arrest, he said, was “all news to me.”
“She went her direction and we went ours,” Broadwater said.
But her alleged victims were eager to hear news of Carpenter’s arrest and her alleged frauds.
Texas businessman Russ Behl said he probably was “the biggest loser,” having sunk between $2 million and $3 million into her Lathrop proposal, which investors told The Bee unfolded between 2004 and 2010.
That plan envisioned the world’s largest movie studio built inside a $3.49 billion “city within a city” of more than 12,000 homes. A 57-page “confidential” business plan Carpenter presented to investors described the project as including a water park, a theme park and an “up-scale California gaming club.”
Behl said the money he lost in that deal forced him to delay retirement and continue working to support himself and his college-age children.
“It’s changed my life,” said Behl, who lives in Colleyville, Texas.
The Lathrop project described in the business plan, obtained by The Bee last year, centered on the 5,000-acre River Islands housing development just south of Stockton. But officials with that project said last year that Carpenter had nothing to do with River Islands and that they had not seen her plan – which included the claim that she had “invested her net worth of over $123 million” into the project.
For each project pitch, Carpenter indicated that the financing had been arranged or would be approved shortly, and hinted strongly that she had the backing of some of Hollywood’s biggest names.
But The Bee found that she owned no property herself and was being pursued in court by people claiming she owed them money for everything from cosmetic surgery to unpaid vet bills.
One investor, Utah dentist Ryan Willden, said he lost $500,000 to Carpenter and, despite waging a fight in court that resulted in a judgment in his favor, has no hope of recouping his losses.
Willden said he had been interviewed by FBI agents in recent months and was pleased at the news of Carpenter’s arrest.
“She needs to pay,” he said. “She has just manipulated so many people, hurt a lot of people’s lives, too, so it’s good she’s going to jail,” he said.
The FBI investigated Carpenter’s dealings about a dozen years ago, but took no action. Following The Bee investigation, however, as more and more investors surfaced who said she had taken their money but built nothing, agents in the Sacramento field office and the Internal Revenue Service’s criminal division began a new probe that led to her being indicted on Oct. 30, a development kept quiet until she could be arrested Wednesday.
In addition to the mail fraud and wire fraud counts, the indictment charges her with three counts of lying to FBI agents during a July 16, 2013, interview about whether she told investors she planned to use their money for personal expenses.
The indictment alleges she lied to an agent by saying that 50 percent to 75 percent of the investor money went to company expenses and about whether two prominent producers had agreed to move their movie business to the proposed project in Lathrop.
The individuals are not named, but are identified as “G.L.” and “H.K.”
Investors have repeatedly told The Bee that Carpenter indicated “Star Wars” creator George Lucas planned to be a part of her projects, something Lucas’ studio has said it knows nothing about. “H.K.” may refer to Howard Kazanjian, a producer on huge movie hits such as “Indiana Jones” and “Star Wars: Return of the Jedi.”
Carpenter touted Kazanjian as a leader of her efforts from 1997 onward, but he wrote in an email last year that he was severing his ties with her after The Bee’s initial revelations and after he concluded the financing for her studio project did not exist.
Call The Bee’s Sam Stanton, (916) 321-1091.