Redwood Scientific Applied sciences proprietor Jason Edward Thomas Cardiff has been arrested.
Cardiff’s arrest was on November twenty sixth, following his indictment beneath seal in March 2022 (not a typo). Following his arrest, Cardiff’s indictment was unsealed on November twenty seventh.
In relation to the Redwood Scientific Applied sciences civil fraud case the FTC filed in 2018, Cardiff has been charged with public corruption, aggravated ID theft and mail and wire fraud.
Particular illegal conduct detailed in Cardiff’s indictment embody:
- utilizing buyer debit and bank card accounts “knowingly and with intent to defraud”
- utilizing buyer names, credit score and debit card account numbers “with out lawful authority”
- “corruptly persuad(ing) one other particular person … to change, destroy, mutilate, and conceal … emails and digital information”
The primary two fees had been central the FTC’s civil case towards Redwood and Cardiff. The concealing and destruction of proof came about throughout court docket proceedings.
It ought to be famous that the Cardiff’s finally misplaced the FTC’s case towards them. Because of the Supreme Courtroom’s AMG determination nonetheless, no financial penalties had been ordered.
Cardiff is thought to BehindMLM by way of his failed RengaLife MLM firm.
Each Redwood and Rengalife marketed
skinny movie strips marketed as homeopathic treatments inflicting weight reduction, male sexual enhancement, and smoking cessation.
Following his arrest, Cardiff was arraigned on November twenty seventh and pled not responsible to 4 fees.
On the arraignment a jury trial was tentatively scheduled for January twenty third, 2024.
Within the meantime a detention listening to is scheduled for November thirtieth (later immediately).
On November twenty ninth, the DOJ filed a memorandum of regulation in help of Cardiff’s detention. Within the submitting we acquire additional perception to the case towards him.
Firstly when you’re questioning why Cardiff was arrested a couple of days in the past having been indicted again in 2022, it’s as a result of
Shortly after the FTC litigation led to early 2022, Cardiff bought his residence in the USA and moved to Eire, the place he maintains twin citizenship.
His spouse and daughter moved with him and are presently residing in Eire.
Whereas Eire has an extradition treaty with the US, it doesn’t extradite its residents. As such,
On November 26, 2023, U.S. Customs and Border Safety officers arrested Cardiff at LAX Airport after Cardiff returned to the USA from Eire, by way of London, United Kingdom.
In arguing for his detention, the DOJ claims Cardiff “poses a considerable threat of flight and a hazard to the neighborhood.”
In counts 1 and a couple of, Cardiff brought on a whole lot of hundreds of {dollars} in losses to hundreds of victims throughout the USA over a interval of only a few months.
When Cardiff discovered his firm beneath investigation, Cardiff then brought on it to fail to adjust to a civil investigative demand issued by the FTC, requiring Hon. James S. Otero to carry contempt proceedings in July and August 2019.
To not be deterred by the Courtroom’s orders within the civil case, and moderately than produce paperwork to the FTC, Cardiff instructed at the least two staff to destroy them, which serves as the idea for counts 3 and 4 of the Indictment.
Moreover, the load of the federal government’s proof towards Cardiff is robust, together with inculpatory emails written by Cardiff and his staff in perpetrating this scheme to defraud former clients, monetary information from Redwood’s fee processors and buyer relationship administration system, and statements from former staff relating to Cardiff’s orders to destroy related paperwork.
Lastly, the federal government’s proof towards Cardiff has already been examined and located to be persuasive throughout the civil matter, as seen with the Courtroom’s final findings towards Cardiff.
With respect to Cardiff’s character and him being a flight threat, the DOJ asserts
Cardiff has a confirmed historical past of deception and dishonesty within the representations he made to the Courtroom and proven that he can’t comply with court docket orders.
Particularly, Decide Otero discovered that Cardiff obtained a second Irish passport after the Courtroom had seized his first one through the FTC litigation.
There, the Courtroom ordered Cardiff held in a single day whereas the second passport was positioned and secured.
Individually, the Courtroom discovered that Cardiff repeatedly lied to the court-appointed receiver about his belongings and hid his earnings and belongings from the court docket.
Instrumental to concealing Cardiffs belongings was Jacques Poujade (proper).
In October 2023, Poujade was sentenced to 5 years in jail on unrelated securities fraud fees.
Throughout a contempt listening to on July 31, 2019, the Courtroom acknowledged, “I’d say of the 16 years I’ve been on the federal court docket, I’ve by no means presided over a matter the place the fraud dedicated by the defendants was so clear, the deception so excessive. I’m astounded.”
As well as, the Courtroom acknowledged, “I’ve heard rigorously from the Cardiffs. Their tales are completely unbelievable. It’s fairly clear to the Courtroom that they’ve lied, that they labored in live performance with one another and with others to keep away from, violate the situations of the orders of the Courtroom.”
Given Cardiff’s historical past and full disregard for prior orders issued by the Courtroom, Cardiff is unlikely to stick to situations imposed by this Courtroom if launched.
Cardiff poses a big threat of flight for a number of causes.
First, Cardiff’s present ties to the USA are tenuous at greatest. Cardiff has no residence inside the USA.
Cardiff has not returned to the USA since he left in early 2022 and maintains twin U.S. and Irish citizenship.
Additionally as mentioned above, the Courtroom discovered that Cardiff tried to flee and held Cardiff in contempt for acquiring a second Irish passport after the Courtroom had seized his first.
Second, Cardiff allegedly possesses vital belongings and certain has the means to flee from prosecution.
Cardiff flaunts wealth by posting photos and making statements about it on social media.
Unexplained is why Cardiff has not provided any collateral as bond for himself.
I could possibly be leaping the gun a bit right here, but it surely appears Redwood additionally is perhaps getting used for cash laundering.
In distinction, Cardiff’s firm, Redwood, lately filed a Registration Assertion with the Securities and Alternate Fee, whereby it acknowledged that its “operations have been largely funded by Cardiff (our CEO and majority stockholder) and his associates, which funding is handled as contributions to capital.”
Cardiff signed the assertion.
Redwood additionally
“requires roughly $350,000 monthly on an annualized foundation for working bills to fund the prices related to our financing actions, authorized and accounting bills, different normal and administrative bills, analysis and improvement, regulatory compliance, product improvement and upkeep, third celebration manufacturing charges, and compensation of government administration and our staff.
Primarily based on our present money place, with out further financing we could not have the ability to pay our obligations previous the fourth quarter of fiscal 2023.”
Redwood additionally famous within the Registration Assertion the next:
As described within the report of our auditors for the years ended December 31, 2022 and 2021 and the notes to our monetary statements, there’s substantial doubt about our capacity to proceed as a going concern, and if we’re unable to proceed, it’s possible you’ll lose your whole funding.
The uncertainty about our capacity to proceed in operation is predicated on our persevering with losses from operation, restricted income and restricted working capital, amongst different issues which existed as of year-end December 31, 2022 and December 31, 2021.
As of December 31, 2022, we had a money steadiness of $0, working capital of $0 and an accrued deficit of $5,275,421.
Redwood additionally acknowledged that yr finish working bills for 2022 totaled $143,713, which can be the corporate’s internet loss.
For 2021, Redwood famous that it was beneath receivership (along with the FTC litigation), and didn’t have any income or bills, however did have a deficit of over $5 million.
No compensation was paid to Cardiff in 2021 and 2022. Nevertheless, based on Cardiff, Redwood has commenced medical trials of its merchandise in Chicago, Illinois and approximate the associated fee as $1.25 million, the supply of which is unknown.
As such, there’s substantial doubt that Cardiff is producing any earnings from his job as CEO, but broadcasting on social media that he’s rich and profitable.
Cardiff can’t have it each methods. Even when the Courtroom had been to grant Cardiff bond, defendant is required to keep up lively employment.
Third, Cardiff left the USA and resided in Eire in an try and keep away from arrest on felony fees.
On November 26, 2023, USPIS Postal Inspectors went to LAX to arrest Cardiff after he was detained by United States Customized and Border Safety brokers pursuant to the moment arrest warrant.
After being suggested of his Miranda rights and the fees towards him, Cardiff advised arresting brokers that the FTC shut down his enterprise in 2018, so the 5 yr statute of limitations would have handed for any fees.
Cardiff acknowledged that he received a listening to towards the FTC, so he was now being charged criminally as a result of the FTC is mad about dropping.
It ought to be famous that after Cardiff misplaced his FTC case, Cardiff or somebody related to him repeatedly left feedback on BehindMLM falsely claiming Cardiff received the case.
Additional, Cardiff’s newest journey to the USA was doubtless deliberate to be a brief one. He was arrested with $7,000 in money available and with two carry-ons of bags.
He advised the arresting brokers that he was in Los Angeles to go to his 96-year-old father, who’s sick.
The arresting brokers additionally requested him if anybody in Los Angeles was anticipating him so they may contact them on his behalf and Cardiff acknowledged there was not.
These details, taken collectively, additional strengthen that Cardiff
1) has no ties to this district; and
2) was returning to the USA for a short go to along with his sick aged father and return to Eire.
The DOJ additionally cites Cardiff dealing with “a big jail sentence” as a cause for him to flee. And if he doesn’t, there’s additionally the prospect of witness tampering.
The federal government has string and legit considerations that if Cardiff (was) launched, he would contact witnesses who’re the topic of the tampering fees now that he’s conscious that he’s indicted.
Witness intimidation was a problem in Cardiff’s FTC case.
Pending the end result of Cardiff’s detention listening to later immediately, I’ll put up an replace under. In any other case, keep tuned for rolling protection as we monitor Jason Cardiff’s highway to jail.