Arson Case Briefs
provided by the Bureau of Alcohol, Tobacco, and Firearms
for more information on this Brief, contact:
ATF, Arson and Explosive Programs Division - (202) 927-7930
December 11, 1990
A. IN: 93240-91-3521Z
B. CASE AGENT: Gregory Barnett
C. FIELD DIVISION/OFFICE: San Francisco/Sacramento
D. PHONE: 916-498-5100
Assistant U.S. Attorney
Eastern District of California
On December 11, 1990, an arson destroyed the Charter Mortgage office
building in Modesto, California, at a loss of $500,000. The fire started
in the basement and spread rapidly throughout the building. The structure,
which housed five separate commercial office spaces, was owned jointly by
Lloyd Ploutz and Sheldon Thompson. Ploutz was indicted on April 15, 1992,
for arson and mail fraud.
United States Code
Title 18, section 844(i), Arson
Title 18, section 844(h)(1), Arson to commit another felony
Title 18, section 1341, Mail fraud
1. In November 1988, Lloyd Ploutz, Ed Beneker, and Sheldon Thompson purchased
an office building from June Longley. Thompson and his company, Charter
Mortgage (a private money mortgage company), had rented the building since
2. At that time, Charter Mortgage was being sued by one of its borrowers.
In an attempt to protect the building from the law suit, Thompson, Ploutz,
and Beneker purchased it in the name of a corporation they had recently
formed, Mariposa Land and Development (MPL&D), and Thompson's name was
deliberately omitted from title documents. Through Charter Mortgage, Thompson
secured a second deed of trust from two of his investors. Longley carried
back $120,000 secured by a first deed of trust with MPL&D. Between January
and June 1989, Thompson paid rent to MPL&D with the understanding that
Beneker and Ploutz would make the payments on the first and second deeds
of trust. Thompson later learned that Beneker and Ploutz had not been making
these mortgage payments.
3. In June 1989, Ploutz attempted to evict Thompson from his office over
a dispute involving some furniture Ploutz had purchased. Thompson reminded
Ploutz that he (Thompson) had a third interest in the building. At that
point, Ploutz pulled out the title documents to the building and showed
Thompson he was not legally documented as part owner.
4. In October 1989, June Longley filed a Notice of Default against MPL&D
for failure to pay principal and interest payments on Longley's first deed
5. In November 1989, Thompson filed suit and recorded a Notice of Lis
Pendens against MPL&D, claiming his one-third interest in the Charter
6. In early December 1989, Charter Mortgage filed a Notice of Default
against Ploutz for his failure to pay off an earlier Charter Mortgage loan
he had used to purchase his residence. Ploutz had made no payments on the
loan, which was due and payable on June 14, 1989.
7. Later that same month, Ploutz negotiated a $55,000 loan with his mother-in-law,
Lucille Sabers, to be secured by a third deed of trust in the name of Mariposa
Land and Development against the Charter Mortgage building. Ploutz did not
record the note and deed, nor did he list Sabers as a loss payee on the
8. In early April 1990, Charter Mortgage filed a Notice of Trustees'
Sale giving notice that Ploutz' house would be sold at public auction on
May 3, 1990. On May 3, 1990, Ploutz filed for bankruptcy in an attempt to
stop the trustees' sale of his house.
9. On May 9, Ploutz recorded the note and third deed of trust, securing
the loan he had obtained from Sabers.
10. On May 24, Eugene Thompson, Sheldon Thompson's father, purchased
half interest in the second deed of trust used to buy the Charter Mortgage
11. On May 25, Ploutz served Sheldon Thompson with an eviction notice,
giving Thompson 30 days to move Charter Mortgage out of the building. Thompson
ignored the notice and remained in the building.
12. On August 23, 1990, Charter Mortgage obtained the title to Ploutz'
residence through the trustees' sale. Four days later, Beneker transferred
his interest in the Charter Mortgage building to Sheldon Thompson. After
this transaction, the building was owned solely by Sheldon Thompson and
Lloyd Ploutz (MPL&D), subject to the first, second, and third deeds
13. In October 1990, Eugene Thompson purchased the remaining 50 percent
interest in the second deed of trust used to buy the Charter Mortgage building
by MPL&D, making him beneficiary of the deed. Thompson then filed a
Notice of Default against MPL&D for failure to pay on the second deed
14. In November 1990, Ploutz moved out of the house on which Sheldon
Thompson had foreclosed.
15. On November 27, 1990, Sheldon Thompson served Lucille Sabers with
the law suit he had filed against MPL&D for his one-third interest in
the Charter Mortgage building.
16. The next day, Ploutz contacted his insurance company and added Sabers
to the MPL&D policy as a loss payee. Ploutz also requested that the
policy limits be increased from $210,000 to $325,000. In addition, Ploutz
requested that the contents of his office in the Charter Mortgage building
be added to the policy, for $25,000 in coverage.
17. On November 30, 1990, Ploutz mailed letters to the tenants in the
Charter Mortgage building advising them they were not covered by MPL&D's
insurance and should obtain their own personal property insurance. At the
same time, Ploutz moved the majority of the furniture and office equipment
out of his office.
18. On December 10, 1990, Ploutz purchased a 1977 white Ford LTD for
$100 from a towing company in Modesto, California. Ploutz later claimed
that he towed the car to Fresno, California, where he spent the night.
19. While in Fresno, Ploutz called Beneker at his home and made a point
to let Beneker know he was in Fresno and would be out of town for a couple
of days. Beneker said the call was unusual because Ploutz did not share
personal information with him and they had not kept in touch since severing
their business relationship.
20. On December 11, 1990, at approximately 12:01 a.m., a fire was reported
at the Charter Mortgage building. Two witnesses heard an explosion and approached
the burning building from the rear alley. The witnesses saw what they described
as an older white Ford or Mercury sedan pulling out of the parking lot adjacent
to the building. As the car approached the witnesses, the driver quickly
braked, turned the car around and sped away in the opposite direction.
21. During the investigation, Ploutz initially denied owning a white
car and claimed he was out of town on business at the time of the fire.
The LTD that Ploutz had purchased was later located at an associate's residence
in El Centro, California. When confronted, Ploutz said he had purchased
the car to leave at the San Felipe airport in Mexico. Ploutz owned property
in San Felipe and said he wanted to have a car at the airport for the occasions
he flew there. When asked why he didn't mention the white car to the investigators
after the fire, Ploutz said that he was asked if he knew anyone who owned
a white car, not if he owned one.
22. A financial analysis conducted by an ATF auditor concluded that at
the time of the fire, Ploutz' businesses did not have sufficient funds to
finance their various real estate projects and that Ploutz' personal account
was "adverse." This opinion was based on Ploutz' negative net
worth, exceedingly high liabilities, zero balances in bank accounts, numerous
NSF charges, foreclosure suits, liens and judgements.
23. The investigation also revealed that in 1979, a residential structure
owned by Ploutz was destroyed by arson. Ploutz claimed to have been on a
business trip at the time, but he had increased his insurance coverage a
few weeks prior to the fire. When asked about previous fires, Ploutz did
not mention this fire and denied any previous insurance claims for fire
I. LEGAL ISSUES AND PROBLEMS:
At Ploutz' first trial on November 18, 1992, he was found guilty of arson
and mail fraud.
Shortly after the conviction, Ploutz filed a motion for a new trial based
on new evidence. Ploutz claimed to have found a witness who had seen two
individuals speeding out of the parking lot behind the building in a white
pickup truck. The two individuals were located and interviewed. They were
janitors who worked at an adjacent bank. Because they were afraid the fire
would spread to their vehicle, they ran to it and sped away.
The district court judge nevertheless felt this new evidence should be
heard, and he granted a new trial. The Government appealed to the Ninth
Circuit Court of Appeals, but the Court affirmed the granting of the motion
for a new trial without comment.
A second week-long trial was held on July 18, 1995. Despite testimony
from the witnesses who saw the white car at the fire, a number of jurors
said they were confused by the "alibi" jury instruction that required
the Government to place Ploutz at the scene of the fire. The jury was unable
to reach a verdict, and the judge ruled a mistrial.
J. VERDICT AND SENTENCING:
On November 22, 1996, following a third trial, Ploutz was convicted of
Arson, Arson to Commit Another Felony, and Mail Fraud. At this trial, the
judge modified the "alibi" instruction and added an "aiding
and abetting" instruction to avoid confusion regarding the necessity
of proving the defendant's whereabouts at the time of the fire. On March
3, 1997, Ploutz was sentenced to 93 months in prison and 36 months' supervised