Palmer: Unpasteurized milk farmer
facing sentencing for real estate fraud

August 29, 2014
Santa Paula News

A Santa Paula woman whose initial arrest for the production of raw milk made her a martyr to some advocates of unpasteurized dairy products has pleaded guilty to 14 felony counts involving fraudulent transactions related to the purchase of the 51-acre Healthy Family Farms dairy on Wheeler Canyon Road.

Sharon Ann Palmer, 54, earlier this month entered guilty pleas to 14 felony counts and as many special allegations that stemmed from the real estate transaction regarding financing for the dairy. 

She initially faced 38 felony charges but pleaded guilty to the counts that included theft, money laundering, securities fraud and conspiracy to commit a crime.

The case started in February 2008 when Palmer entered into a lease-purchase option with the owners of the farm at 6780 Wheeler Canyon Road. 

Palmer and James Cecil Stewart, her ex-husband and a co-defendant in the case, asked Larry Otting if they could use his credit to obtain a loan to purchase the property and then opened an escrow account to complete the deal.

Palmer and the 67-year-old Stewart, allegedly told Otting that he could use 10 acres of the property in exchange for letting the couple use his credit for the purchase. Palmer and Stewart told Otting investors would provide the down payment and that they would make all the mortgage and property tax payments.

Unwitting investors were told to wire money to Otting or Healthy Farms because the bank would have denied the loan if it knew the money came from third parties. Unsigned deeds of trust were then given to investors.

Palmer was arrested in December 2008 for selling unpasteurized milk, goat cheese and other products without a license; she was arrested again in 2011 at Rawesome Foods, the members-only Venice-area health food store operated by Stewart, who was also taken into custody in relation to the products being sold. 

In March 2012 Palmer, Stewart and Otting were arrested on the charges related to the purchase of the farm property itself. 

Palmer, who remains free on bail, is scheduled for sentencing October 27; there will also be a hearing on whether the sale of her property will help with restitution of the victims in the grand theft case. 

Stewart has a pretrial court conference also on October 27 on 37 felony counts, including grand theft, money laundering, securities fraud, theft from an elder or dependent adult, conspiracy to commit a crime and special allegations.

The 69-year-old Otting pleaded guilty to one count of felony grand theft and one count of conspiracy to commit a crime. Sentencing for Otting is scheduled November 19.





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