Redwood’s Jason Cardiff arrested on multiple counts of fraud
Redwood Scientific Technologies owner Jason Edward Thomas Cardiff has been arrested.
Cardiff’s arrest was on November 26th, following his indictment under seal in March 2022 (not a typo).
After his arrest, Cardiff’s indictment was unsealed on November 27th.
In relation to the Redwood Scientific Technologies civil fraud case the FTC filed in 2018, Cardiff has been charged with public corruption, aggravated ID theft and mail and wire fraud.
Specific unlawful conduct detailed in Cardiff’s indictment include:
- using customer debit and credit card accounts “knowingly and with intent to defraud”
- using customer names, credit and debit card account numbers “without lawful authority”
- “corruptly persuad(ing) another person … to alter, destroy, mutilate, and conceal … emails and electronic records”
The first two charges were central the FTC’s civil case against Redwood and Cardiff. The concealing and destruction of evidence took place during court proceedings.
It should be noted that the Cardiff’s ultimately lost the FTC’s case against them. Due to the Supreme Court’s AMG decision however, no monetary penalties were ordered.
Cardiff is known to BehindMLM through his failed RengaLife MLM company.
Both Redwood and Rengalife marketed
thin film strips marketed as homeopathic remedies causing weight loss, male sexual enhancement, and smoking cessation.
Following his arrest, Cardiff was arraigned on November 27th and pled not guilty to four charges.
At the arraignment a jury trial was tentatively scheduled for January 23rd, 2024.
In the meantime a detention hearing is scheduled for November 30th (later today).
On November 29th, the DOJ filed a memorandum of law in support of Cardiff’s detention. In the filing we gain further insight to the case against him.
Firstly if you’re wondering why Cardiff was arrested a few days ago having been indicted back in 2022, it’s because
Shortly after the FTC litigation ended in early 2022, Cardiff sold his residence in the United States and moved to Ireland, where he maintains dual citizenship.
His wife and daughter moved with him and are currently residing in Ireland.
While Ireland has an extradition treaty with the US, it does not extradite its citizens. As such,
On November 26, 2023, U.S. Customs and Border Protection officers arrested Cardiff at LAX Airport after Cardiff returned to the United States from Ireland, via London, United Kingdom.
In arguing for his detention, the DOJ claims Cardiff “poses a substantial risk of flight and a danger to the community.”
In counts 1 and 2, Cardiff caused hundreds of thousands of dollars in losses to thousands of victims across the United States over a period of just a few months.
When Cardiff found his company under investigation, Cardiff then caused it to fail to comply with a civil investigative demand issued by the FTC, requiring Hon. James S. Otero to hold contempt proceedings in July and August 2019.
Not to be deterred by the Court’s orders in the civil case, and rather than produce documents to the FTC, Cardiff instructed at least two employees to destroy them, which serves as the basis for counts 3 and 4 of the Indictment.
Additionally, the weight of the government’s evidence against Cardiff is strong, including inculpatory emails written by Cardiff and his employees in perpetrating this scheme to defraud former customers, financial data from Redwood’s payment processors and customer relationship management system, and statements from former employees regarding Cardiff’s orders to destroy relevant documents.
Finally, the government’s evidence against Cardiff has already been tested and found to be persuasive within the civil matter, as seen with the Court’s ultimate findings against Cardiff.
With respect to Cardiff’s character and him being a flight risk, the DOJ asserts
Cardiff has a proven history of deception and dishonesty in the representations he made to the Court and shown that he cannot follow court orders.
Specifically, Judge Otero found that Cardiff obtained a second Irish passport after the Court had seized his first one during the FTC litigation.
There, the Court ordered Cardiff held overnight while the second passport was located and secured.
Separately, the Court found that Cardiff continuously lied to the court-appointed receiver about his assets and concealed his income and assets from the court.
Instrumental to concealing Cardiffs assets was Jacques Poujade (right).
In October 2023, Poujade was sentenced to five years in prison on unrelated securities fraud charges.
During a contempt hearing on July 31, 2019, the Court stated, “I would say of the 16 years I’ve been on the federal court, I’ve never presided over a matter where the fraud committed by the defendants was so clear, the deception so extreme. I’m astounded.”
In addition, the Court stated, “I’ve heard carefully from the Cardiffs. Their stories are totally unbelievable. It’s pretty clear to the Court that they’ve lied, that they worked in concert with each other and with others to avoid, violate the conditions of the orders of the Court.”
Given Cardiff’s history and complete disregard for prior orders issued by the Court, Cardiff is unlikely to adhere to conditions imposed by this Court if released.
Cardiff poses a significant risk of flight for multiple reasons.
First, Cardiff’s current ties to the United States are tenuous at best. Cardiff has no residence within the United States.
Cardiff has not returned to the United States since he left in early 2022 and maintains dual U.S. and Irish citizenship.
Also as discussed above, the Court found that Cardiff tried to flee and held Cardiff in contempt for obtaining a second Irish passport after the Court had seized his first.
Second, Cardiff allegedly possesses significant assets and likely has the means to flee from prosecution.
Cardiff flaunts wealth by posting pictures and making statements about it on social media.
Unexplained is why Cardiff has not offered any collateral as bond for himself.
I could be jumping the gun a bit here, but it seems Redwood also might be being used for money laundering.
In contrast, Cardiff’s company, Redwood, recently filed a Registration Statement with the Securities and Exchange Commission, wherein it stated that its “operations have been largely funded by Cardiff (our CEO and majority stockholder) and his affiliates, which funding is treated as contributions to capital.”
Cardiff signed the statement.
“requires approximately $350,000 per month on an annualized basis for operating expenses to fund the costs associated with our financing activities, legal and accounting expenses, other general and administrative expenses, research and development, regulatory compliance, product development and maintenance, third party manufacturing fees, and compensation of executive management and our employees.
Based on our current cash position, without additional financing we may not be able to pay our obligations past the fourth quarter of fiscal 2023.”
Redwood also noted in the Registration Statement the following:
As described in the report of our auditors for the years ended December 31, 2022 and 2021 and the notes to our financial statements, there is substantial doubt about our ability to continue as a going concern, and if we are unable to continue, you may lose your entire investment.
The uncertainty about our ability to continue in operation is based on our continuing losses from operation, limited revenue and limited working capital, among other things which existed as of year-end December 31, 2022 and December 31, 2021.
As of December 31, 2022, we had a cash balance of $0, working capital of $0 and an accumulated deficit of $5,275,421.
Redwood also stated that year end operating expenses for 2022 totaled $143,713, which is also the company’s net loss.
For 2021, Redwood noted that it was under receivership (in conjunction with the FTC litigation), and did not have any revenue or expenses, but did have a deficit of over $5 million.
No compensation was paid to Cardiff in 2021 and 2022. However, according to Cardiff, Redwood has commenced clinical trials of its products in Chicago, Illinois and approximate the cost as $1.25 million, the source of which is unknown.
As such, there is substantial doubt that Cardiff is generating any income from his job as CEO, yet broadcasting on social media that he is wealthy and successful.
Cardiff cannot have it both ways. Even if the Court were to grant Cardiff bond, defendant is required to maintain active employment.
Third, Cardiff left the United States and resided in Ireland in an attempt to avoid arrest on criminal charges.
On November 26, 2023, USPIS Postal Inspectors went to LAX to arrest Cardiff after he was detained by United States Custom and Border Protection agents pursuant to the instant arrest warrant.
After being advised of his Miranda rights and the charges against him, Cardiff told arresting agents that the FTC shut down his business in 2018, so the five year statute of limitations would have passed for any charges.
Cardiff stated that he won a hearing against the FTC, so he was now being charged criminally because the FTC is mad about losing.
It should be noted that after Cardiff lost his FTC case, Cardiff or someone associated with him repeatedly left comments on BehindMLM falsely claiming Cardiff won the case.
Further, Cardiff’s latest trip to the United States was likely planned to be a short one. He was arrested with $7,000 in cash on hand and with two carry-ons of luggage.
He told the arresting agents that he was in Los Angeles to visit his 96-year-old father, who is ill.
The arresting agents also asked him if anyone in Los Angeles was expecting him so they could contact them on his behalf and Cardiff stated there was not.
These facts, taken together, further strengthen that Cardiff
1) has no ties to this district; and
2) was returning to the United States for a brief visit with his ill elderly father and return to Ireland.
The DOJ also cites Cardiff facing “a significant prison sentence” as a reason for him to flee. And if he doesn’t, there’s also the prospect of witness tampering.
The government has string and legitimate concerns that if Cardiff (was) released, he would contact witnesses who are the subject of the tampering charges now that he is aware that he is indicted.
Witness intimidation was an issue in Cardiff’s FTC case.
Pending the outcome of Cardiff’s detention hearing later today, I’ll post an update below. Otherwise, stay tuned for rolling coverage as we track Jason Cardiff’s road to prison.
Update 2nd December 2023 – The court has denied the DOJ’s request Jason Cardiff be detained pending trial.
On November 30th Cardiff was released on a $530,000 appearance bond and 24/7 location monitoring.
Cardiff is restricted to travel between California and Texas, and is subject to an 8pm to 8am curfew. He has also surrendered his passport and travel documents.
Update 7th December 2023 – Cardiff’s bond failed approval owing to issues with “the present fair market value of the property” put up.
The tax assessment on which defendant relies is as of 1/1/23, a year ago an [sic] the court has no idea how the Texas real estate market has fared in the last year.
There was also a clerical error on Cardiff’s filed third-party custodian form.
I believe Cardiff will remain in custody pending remedy of his bond filings.
Update 24th January 2024 – Following a Joint Stipulation filed on January 11th, on January 19th the court rescheduled Cardiff’s trial to April 8th, 2024.