Summer recycling fraud stings lead to 11 arrests in California

The California Department of Justice (CDOJ) has released the findings from two recycling fraud investigations resulting in 11 arrests in the summer of 2016. Each case involved the collection, illegal transport and fraudulent redemption of out-of-state used beverage containers through the California Redemption Value (CRV) program, CDOJ says.

“One by one, CalRecycle and its enforcement partners are targeting and dismantling these recycling fraud organizations,” CalRecycle director Scott Smithline says. “CalRecycle will not tolerate these smuggling operations to defraud the CRV program of deposits that rightfully belong to California consumers.”

California’s Beverage Container Recycling and Litter Reduction Act incentivizes recycling through a CRV fee paid by California consumers at the time of purchase and refunded upon return of the empty beverage containers to CalRecycle-certified recycling centers. Because the fee is not paid on beverages purchased outside the state, those containers are not eligible for CRV redemption.

The CDOJ investigates and prosecutes criminal cases on behalf of CalRecycle, which has administrative authority over the state’s beverage container recycling program. In addition to CalRecycle’s interagency agreements with CDOJ and California Department of Food and Agriculture (CDFA), CalRecycle says it aggressively combats fraud and illicit payments through enhanced precertification training of recycling center owners, probationary reviews of recycling centers, oversight of certified processors, monitoring and tracking of imported materials, risk assessment of daily claims for reimbursement, daily load limits, application of prepayment controls and postpayment reviews and investigations.

Aug. 18, 2016, Rocio Zamora, 45; Santiago Zamora, 53; Margarita Medrano, 36; Idelfonso Salas, 36; and Ulises Adame, 28, all of Rio Linda, California, were arrested on charges of conspiracy, grand theft and felony recycling fraud.

Dec. 15, 2015, agents with CDOJ’s Recycling Fraud Team were conducting an investigation at a recycling center in Reno, Nevada, when they observed the Zamoras loading used beverage containers into a rental truck. Agents followed the truck into California on a route designed to avoid a required stop at the CDFA border checkpoint in Truckee. Agents continued their surveillance to the couple’s residence on 32nd Avenue in Rio Linda and then to a nearby storage facility. The couple was later seen redeeming the plastic and aluminum at recycling centers in Rio Linda and Sacramento, CDOJ says.

Subsequent surveillance operations revealed similar activity and additional storage lockers in Yuba City and in Rio Linda. Agents also observed frequent redemptions at nearby recycling centers in the area. The investigation led to the identification of three additional family members, believed to be conspiring to defraud the CRC program by illegally importing and redeeming out-of-state used beverage containers, CDOJ says.

Aug. 18, 2016, CDOJ agents served search warrants at the Zamoras’ residence and at Yuba City Self Storage on Steward Road. Agents arrested five suspects and seized an assault rifle, two handguns and a semiautomatic .22-caliber rifle. The Zamoras’ storage locker was found to contain 1,520 pounds of aluminum and 840 pounds of plastic used beverage containers with a potential value of $3,386.

In early June 2016, Marco Rodriguez-Montano, 38, of Carson City, Nevada; Jose Martinez-Lozano, 49, of Fernley, Nevada; Francisco Limon, 61, of Reno, Nevada; Juan Valdez, 40, of Reno; and Herlindo Samayoa, 46, of Sacramento, California, were arrested on charges of conspiracy, grand theft and felony recycling fraud.

May 29, 2015, agents with CDOJ’s Recycling Fraud Team launched an investigation after receiving a tip regarding used beverage containers from Nevada recycling centers being transported into California without legally required documentation. Information led agents to facilities in Reno and Fernley, where they identified Rodriguez-Montano as a primary suspect. Samayoa and four other people were identified as co-conspirators in a scheme to defraud the CRV Fund.

During the course of the investigation, agents observed multiple loads of used beverage containers being loaded into rented moving trucks in Reno, CDOJ says. The suspects took the material across state lines using routes designed to avoid required stops at the CDFA border checkpoint in Truckee. The used beverage containers were taken to a storage facility on Weyand Drive in Sacramento before winding up at a nearby recycling center, CDOJ adds.

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June 1, 2016, CDOJ says its agents served search warrants at two locations in Sacramento—8585 Weyand Dr. and 4226 Barbara St.—and one in Carson City at 3250 Banjo Circle. Valdez, Limon, and Samayoa were arrested at the Weyand location, while Rodriguez-Montano was arrested in Carson City. Agents seized 3,580 pounds of aluminum and 2,340 pounds of plastic used beverage containers from the truck and the Weyand storage facility. The material had a potential CRV of $8,452.

The following day, agents served a search warrant at the Tepeyac Market on West Main Street in Fernley and arrested Martinez-Lozano, CDOJ says.

A sixth suspect, Erendida Ramirez, 58, of Sacramento was arrested on charges of conspiracy, grand theft and felony recycling fraud Sept. 19, 2016.