Prosecutors seeking prison for portable-toilet executives behind illegal dumping scheme

  • San Marcos sanitation company owner Arie Eric De Jong III is facing up to 2½ years in federal prison for illegally dumping portable-toilet waste into sewer systems to avoid paying disposal fees.
  • Prosecutors also want another company official to spend five months in prison and five months of home detention, and total fines and restitution of more than $15 million.
  • Sentencing is scheduled Friday in the case, which prosecutors say is being watched by industry rivals across California.

Federal prosecutors want to make an example of a San Marcos portable-toilet company that illegally dumped its waste into city sewer systems across Southern California. Not only do they want millions of dollars in fines and restitution, they want the two co-owners locked up.

According to sentencing recommendations filed in U.S. District Court, Diamond Environmental Services owner Arie Eric De Jong III should spend 30 months in federal prison for overseeing an illegal-dumping scheme that for years avoided millions of dollars in discharge fees.

He also would pay $3.9 million in restitution and a $10,000 fine.

Company chief operating officer Warren Van Dam should spend five months in prison, serve another five months of home detention and also pay $3.9 million in restitution, prosecutors said.

“The entire portable toilet industry in the state of California is following this case,” Assistant U.S. Attorney Melanie Pierson wrote to the court. “They cannot receive the message that discharging trucked portable toilet waste at unauthorized locations to avoid paying fees for lawful discharge is acceptable.”

The sentencing, which has been put off multiple times as lawyers for the company and its co-owners dispute the penalty terms and restitution calculations, is now scheduled Friday at the federal courthouse in San Diego.

Another Diamond executive named Ronald Tabor was convicted of lying to a grand jury about the illegal dumping after a trial last year. He was sentenced to five years probation and ordered to perform 200 hours of community service early this year.

Despite guilty pleas signed last year, De Jong and Van Dam dispute numerous claims in the pre-sentencing reports.

“They’ve agreed to and they will pay restitution that the victims are entitled to,” said defense attorney Knut Johnson, who represents De Jong. “We are trying to figure out what those should be.”

Pierson filed a motion late last month asking Judge Roger T. Benitez to find Diamond and De Jong in breach of plea agreements they signed last spring, but the judge has not ruled on that request.

Court papers say Diamond saved up to $4.1 million between 2012 and 2016 by dumping portable-toilet waste into sewer systems in San Diego, San Marcos, Fullerton, Perris and Huntington Park instead of paying to dispose of the materials in specially designated facilities.

De Jong disputed that assertion during a telephone interview with The San Diego Union-Tribune in January but said he could not elaborate while the criminal case remains unresolved.

Prosecutors say Diamond avoided millions of dollars in fees by unloading its trucks into municipal sewer systems in numerous cities. The practice saved Diamond money and denied the public revenue that could be used to maintain and improve sanitation systems, they said.

Service at the North City Water Reclamation Plant in San Diego was briefly interrupted in 2016 after ammonia spikes were reported -- anomalies the U.S. government said was most likely due to the illegal dumping.

Experts hired by San Diego officials were unable to figure out what happened, but prosecutors said they lacked critical information.

“Neither of the consultants identified Diamond as they source of the problem, but neither of the consultants were aware that just a short distance downstream, a large slug of ammonia was being illegally dumped on a daily basis,” they wrote.

Johnson said the ammonia spikes could be attributed to a number of breweries in the area.

“There are all sorts of reasons for an ammonia spike,” he said.

According to court filings, the recommended prison sentence and financial penalties are appropriate and reasonable. The De Jong family controls assets and property worth about $39 million, prosecutors said.

Van Dam also has the financial ability to pay almost $4 million in restitution, court records say.

Diamond Environmental Services has a net worth of about $6.5 million, prosecutors said.

The company generates about $3.5 million in revenue and $257,000 in profits each month. The sentencing recommendation calls for the company to receive five years probation, a $4.7 million fine and $3.9 million in restitution. It should also forfeit $3.7 million in cash, the government said.

jeff.mcdonald@sduniontribune.com (619) 293-1708 @sdutMcDonald

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