New Mexico entrepreneur faces federal fraud, tax evasion charges

A New Mexico engineer and four business partners who once proposed basing an aerospace company at a massive campus in Albuquerque now face federal charges for allegedly defrauding investors of $250 million, court records show.

A federal indictment unsealed March 18 in U.S. District Court for the District of Columbia charged Erlend Olson, 62, with 11 counts of fraud and tax evasion in connection with the alleged scheme.

Albuquerque Mayor Tim Keller and other officials held a news conference in November 2020 to trumpet a potential development project for the Theia Group on a 115-acre campus near the Albuquerque International Sunport.

The company planned to digitally model the planet with a network of satellites. City officials said at the time that the development was so big they were afraid to “jinx” the deal by announcing it publicly.

But within a year, the planned Orion Center imploded amid financial and legal problems that prompted city officials to kill the company’s lease agreement on land owned by the Albuquerque Aviation Department near Gibson and Girard SE.

Olson was arrested March 17 and remains in custody at the Northern Neck Regional Jail in Warsaw, Virginia, according to jail and court records. His attorney, Berry Coburn of Washington, D.C., declined comment this week.

Olson, John Gallagher, Stephen Buscher, Joseph Fargnoli and Jamil Swati — the company’s five principals — are each charged with one count of conspiracy to commit wire and mail fraud, according to a statement issued by the U.S. Attorney’s Office, District of Columbia.

In addition, Olson was charged with five counts of wire fraud, one count of mail fraud, and four counts of tax evasion, the statement said.

All five are scheduled to appear at a July 7 hearing before U.S. District Judge Royce C. Lamberth of the District of Columbia.

Lamberth ordered Gallagher, Buscher, Fargnoli and Swati released on personal recognizance in May. Olson is the only one of the five who resides in New Mexico.

The indictment describes Olson as an “engineer and inventor” who founded the Theia Group in 2014 with plans to launch 112 satellites to provide continuous remote sensing data covering the globe. The network was intended to provide real-time data about earthquakes, wildfires, crime and help identify underground natural resources.

The total cost of the project was estimated at up to $15 billion with a target launch date of 2022 to 2025, the indictment said. The company originally planned to raise funding from nation-states but were unsuccessful in finding sovereign investors, it said.

However, Theia raised $250 million in loans and investments “induced by fraud,” including “false statements about revenue from non-existent government contracts,” and false statements of technical capabilities, the U.S. Attorney’s Office alleges.

Between 2018 and 2020, Olson “concealed from the IRS millions of dollars in compensation he received from Theia,” which he directed into an entity called Meridian Ventor Corp. (MVC), the statement said.

Olson then used money from MVC to pay for personal expenses, including a private jet membership, rent payments for his home and two condominiums in Las Vegas, it said.