Advertisement
California

Former hemp oil entrepreneur dies in high-speed crash weeks before sentencing in fraud scheme

The former head of a San Diego County hemp oil business died in a fiery car crash Sunday, just weeks before he was to be sentenced in federal court for his role in a Ponzi scheme that cost victims more than $10 million, according to coroner’s officials and court records.

Michael Llamas, 33, was driving a 2016 Lamborghini at “excessive speeds” along Harbor Drive near downtown San Diego shortly before 2 a.m. Sunday when he lost control of the vehicle, according to a statement released by the San Diego County medical examiner’s office.

The vehicle slammed into a curb, a palm tree and an “ornamental anchor” before bursting into flames, the medical examiner’s office said. Llamas was pronounced dead inside the vehicle. A female passenger was ejected from the vehicle; the extent of her injuries was not clear.

A spokeswoman for the San Diego Harbor Police could not immediately comment further on the crash. The medical examiner’s office ruled Llamas’ death an accident.

Advertisement

Llamas was the former chief executive of Medical Marijuana Inc., a Poway-based company that sold health and beauty products made from “industrial hemp.” He stepped down in 2012 after he was indicted for his role in a mortgage fraud scheme that cost lenders and other victims more than $10 million, prosecutors have said.

Michael Pancer, Llamas’ attorney, described his client as a “good guy” who was fooled into cooperating in the scheme.

“He was a friend as well as a client,” Pancer said.

According to the 50-count indictment, Llamas and another man entered into “option contracts” with several developers in 2007 and 2008, arranging to make “bulk real estate purchases” in Bakersfield and Atwater, Calif.; and Fort Myers and Port St. Lucie, Fla.

Advertisement

Under the terms of those deals, the developers agreed to sell Llamas the properties at up to half the market price, according to the indictment.

Llamas, however, had no intention of buying the properties, according to the indictment. The homes were instead sold at full price to individuals recruited by Lee Loomis, the man charged with masterminding both the mortgage fraud scheme and a separate Ponzi scheme in several states, according to the indictment.

Loomis would then arrange for the victims to obtain mortgage loans “with banks and other lenders at the full price of the homes without disclosing the large price discount,” federal prosecutors said in a 2012 news release. Loomis, Llamas and other defendants would then split the profit of the price discount, prosecutors said.

Pancer said Loomis had an “excellent reputation” among bankers, lawyers and mortgage lenders at the time Llamas went into business with him. His client, Pancer said, was “among hundreds of other people misled by Mr. Loomis.”

Llamas pleaded guilty to conspiracy to commit wire fraud in August 2016, and was scheduled to be sentenced next month, according to federal court records. Pancer said he was hopeful that Llamas would be granted probation at that hearing.

He had received permission to travel to Switzerland, Iceland and Germany on business between Nov. 3 and Nov. 16, according to a court order filed last week, meaning he was supposed to be out of the country on the night of the fatal crash.

Pancer said it was not abnormal for Llamas to schedule and then cancel business trips. He was involved in a new company, though the attorney could not offer specifics about the business. Pancer did not know why Llamas canceled the trip or what he was doing before the crash Sunday morning.

Medical Marijuana Inc. released a statement expressing grief over Llamas’ death.

Advertisement

“The company has learned that Michael Llamas died in a traffic accident over the weekend in San Diego. The company mourns the loss of one of its visionary founders,” the statement read. “Mr. Llamas was an incredible philanthropist and changed countless lives throughout the world.”

Times Staff Writer Matt Hamilton contributed to this report.

james.queally@latimes.com

Follow @JamesQueallyLAT for crime and police news in California.


UPDATES:

1 p.m.: This article was updated with a statement from Medical Marijuana Inc.

This article was first published at 10:35 a.m.

Advertisement


Advertisement