News Release

Office of Public Affairs

For Immediate Release: May 7, 2015
Release #2015-10
For more information contact:
Media Contact: Lance Klug (CalRecycle) |

SACRAMENTO--California’s Department of Resources Recycling and Recovery (CalRecycle) is announcing the indictments of five Californians on grand theft and recycling fraud charges in Kern County. CalRecycle and the California Department of Justice’s Recycling Fraud Team conducted an investigation spanning nearly two years that revealed a complex scheme involving out-of-state used beverage containers, 24 Southern California recycling centers, and $14 million worth of fraudulent California Redemption Value claims.

“Californians rightly expect us to act aggressively to combat CRV fraud,” CalRecycle Director Caroll Mortensen said. “These indictments send a clear message to anyone who thinks they can cheat the system by illegally cashing in on out-of-state containers through fraudulent CRV redemptions.”

In September 2013, after a referral from CalRecycle, DOJ Recycling Fraud Team investigators observed Rodriguez Recycling of Los Angeles County importing used beverage containers from Arizona. On April 16, 2014, DOJ Recycling Fraud Team agents traveled to Phoenix and witnessed a semi-truck being loaded with used beverage containers. The semi was followed to a dirt lot in Bakersfield, where the containers were off-loaded into a U-Haul truck and onto a 53-foot trailer. A man later identified as Mario Mendoza of Bakersfield then delivered two loads of containers to Sequoia Resources in Bakersfield. Mendoza was arrested. With assistance from CalRecycle, agents later learned the loads were claimed in the names of S&S Recycling, Ignacio Recycling, and Gonzalez Recycling, operated by James Gonzales of Bakersfield. CalRecycle held and denied payment for approximately $100,000 related to these claims.

Evidence obtained through search warrants showed Sequoia Resources loaned more than $20,000 a week to Gonzalez Recycling with the expectation that Gonzales would bring back enough material to cover the cost within three days. Agents also determined that between November 2013 and April 2014, the center fronted roughly $1 million to Gonzales for the redemption of CRV containers. The investigation ultimately determined that Gonzalo Rodriguez of Piru (Ventura County) organized the fraud scheme and relied on his family to either directly operate or form associations with approximately 18 recycling centers in Southern California. Those centers redeemed an estimated $14 million in fraudulent material from the summer of 2012 to the summer of 2014.

While the DOJ Recycling Fraud Team was investigating Rodriguez, CalRecycle conducted parallel administrative investigations and took actions on multiple recycling centers related to the criminal referral. As a result, CalRecycle terminated the program certifications of 20 recycling centers, four others voluntarily decertified from the program, and CalRecycle denied payment of $245,495 in handling fees.

On March 31, 2015, a Kern County Grand Jury indicted Gonzalo Rodriguez, James Gonzales, Mario Mendoza and family members Belen Gonzales of Piru and Adriana Rodriguez of Sylmar. All are in Kern County jail awaiting trial on grand theft and recycling fraud charges except Adriana Rodriguez, who remains at large.

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 containers. Since the fee is never paid by out-of-state consumers, out-of-state containers are not eligible for CRV redemption. CalRecycle aggressively combats fraud through enhanced training of recycling center owners, increased scrutiny of payment claims, daily load limits, and increased enforcement and inspection efforts with cooperation from California’s DOJ and California Department of Food and Agriculture border inspection stations.

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CalRecycle provides oversight of California solid waste handling and recycling programs to protect human health, develop sustainable solutions that conserve resources, and reduce greenhouse gases that contribute to climate change.