Sezgin Baran Korkmaz, claimed CIA contacts could save Utah polygamist brothers from biofuel fraud prosecution

As a billion-dollar biofuel scam in Utah began unraveling around brothers Jacob and Isaiah Kingston, they turned to a Turkish businessman who had allegedly been laundering their money for help.

Sezgin Baran Korkmaz had funelled over $130 million of their money into a Turkish airline, a 50-meter-long yacht and dozens of hotels and luxury properties around Europe, prosecutors said. But he also told them he had an ace up his sleeve if their scheme to steal hundreds of millions in phony biofuel tax subsidies ever came apart — someone he called “Grandpa.”

All the Kingstons needed to do was wire Korkmaz millions of dollars to make a federal grand jury investigation go away, prosecutors said.

“The grandfather called now. It has to be done in 5 days. Last chance,” Korkmaz texted Jacob Kingston in July 2018, meaning they needed to pay up right away, according to court filings.

The Kingstons then sent $6 million to Korkmaz, but less than two months later the brothers and their partner, Levon Termendzhyan, the owner of an empire of California truck stops and gas stations, were indicted on federal tax fraud and money laundering charges in Utah.

“Grandpa big problem [siren emoji] $” Korkmaz wrote days before the indictment was unsealed.  

Korkmaz used the term “Grandpa” to refer to the Central Intelligence Agency, for which he claimed to work, said a person familiar with the case, who spoke on condition of anonymity. Once a criminal case was filed, Korkmaz told the Kingstons the CIA would no longer be able to help make the investigation go away, the person said.

Whether Korkmaz worked for the CIA or had any relationship with the agency is unclear. The CIA declined to comment. Korkmaz’s attorneys didn’t respond to messages seeking comment.

Korkmaz has been documented as having at least one connection to a former U.S. government intelligence official in the past. In 2018, he hosted a delegation of Americans seeking to have a jailed U.S. evangelical pastor released from a Turkish prison where he was facing terrorism charges. The group included a former CIA director, James Woolsey, according to the Organized Crime and Corruption Reporting Project. The group flew to Turkey on a private jet owned by Korkmaz. 

The pastor, Andrew Brunson was freed the following year.

Federal prosecutors, however, say Korkmaz’s offer to the Kingstons was little more than a shakedown and have charged him with fraud in addition to money laundering and obstruction. He was extradited from Austria to Utah late last week after a year-long legal battle. He pleaded not guilty and was held without bond. A spokesman for the U.S. attorney in Utah didn’t reply to a message seeking comment.

The intrigue around Korkmaz, a well-connected businessman with ties to Turkey’s president Recep Tayyip Erdogan, is a fitting coda to a wild case involving the Kingston brothers, members of a breakaway, polygamist Mormon sect known as “the Order,” and Levon Temdendzhyan, a flashy L.A. tycoon whose nickname is “The Lion,” and who law enforcement officials believe has ties to organized crime. 

The Kingstons pleaded guilty in 2019 to charges of conspiracy, fraud and money laundering and Temdendzhyan was convicted at trial in 2020. All three men await sentencing.

Prosecutors say their fraud dates back to 2010 when Jacob Kingston launched Washakie Renewable Energy LLC, a biofuel processing facility in Utah. Over several years, the company filed claims for over $1 billion in federal tax subsidies and other credits for processing vegetable oils into diesel fuel.

But prosecutors said the business was mostly a sham which never produced anywhere near the amount of biofuel it claimed and which used doctored paperwork to claim the tax credits. Temdendzhyan helped the Kingstons move fuel around facilities he controlled in a way that allowed them to make multiple phony claims on the same material.

The trio were charged with using the proceeds to buy a gold Ferrari, a $1.8 million Bugatti sports car, a stake in a casino in Belize and numerous businesses, luxury properties and hotels in Turkey and Switzerland.

Federal authorities have moved to seize the assets the men had acquired, taking possession of a sleek yacht called the Queen Anne last year. It was sold in January for $10.1 million. They have also sought to take possession of several homes the Kingston had purchased in Utah for their multiple wives and children.

Prosecutors say the arrest of Korkmaz in June 2021 in Austria has helped greatly in unwinding where the money ended up.

“Thanks to our law enforcement partners and their counterparts in Austria and Lebanon, we are now able to bring Korkmaz to trial on the pending charges, and have recovered significant forfeiture proceeds,” said acting deputy assistant attorney general Stuart M. Goldberg of the Justice Department’s tax division.

Korkmaz faces up to 20 years in prison if he is convicted.