A Newport Beach couple is behind bars after what prosecutors describe as a yearslong, multimillion-dollar fraud operation that bankrolled an upscale lifestyle. The pair was arrested on Thursday, Feb. 26, and now faces 68 felony counts in Santa Barbara County, where judges are also weighing whether the money used to post bail was legitimately obtained.
What prosecutors allege
According to the Los Angeles Times, court filings accuse Byron “Rick” Tarnutzer, 63, and Vonna Tarnutzer, 70, of using bogus accounting and circular bank transfers to pull in more than $6.4 million in loans from Cake Mortgage Company. They are also accused of taking more than $2 million from a neighbor, Mystica Fleury. Prosecutors say Fleury was overbilled by roughly $200,000 for remodeling work and then persuaded to put in a $1.75 million investment that, instead of going into a project, allegedly went to cover the Tarnutzers’ credit card bills and living expenses.
Prosecutors describe a pattern
As reported by the Santa Barbara Independent, the district attorney’s office portrays the Tarnutzers as “practiced, sophisticated fraudsters” who allegedly worked hard to win people’s confidence, moved money through shell accounts to wash it, and leaned on the threat of costly civil lawsuits to squeeze more cash from their targets. The outlet notes that both defendants were being held in county jail on $2 million bail while prosecutors asked a judge to cut off any chance of release as the criminal case moves forward.
Bail, defense, and next steps…