A Montecito couple was arrested last Thursday at their second home in Newport Beach and charged with 68 felony counts of fraud, conspiracy, grand theft, and money laundering in what authorities described as a long-running pattern of cons that left multiple victims across four California jurisdictions.
If convicted on all counts, Byron “Rick” Tarnutzer and Vonna Tarnutzer ― 63 years old and 70 years old, respectively ― would face decades in prison. “At their age,” a court filing notes, such a sentence “would be, in effect, a life sentence.”
Both Tarnutzers are being held in county jail on $2 million bail, but prosecutors have asked a judge to leave them no option of release as their case proceeds through Superior Court, which could take years.
“The core of the People’s position is this…,” wrote senior prosecutor Brian Cota in a motion filed Monday. “The Tarnutzers are practiced, sophisticated fraudsters who lack any legitimate income stream capable of sustaining their lavish lifestyle, and that has been true for at least a decade.”
Their monthly mortgage payments alone total $43,000, and if the Tarnutzers are released from custody, “the financial pressures they face and their complete lack of legitimate income ensure that they will seek out new victims,” Cota argued. “Their next victim is not a possibility — it is a certainty.”
Fraud is not a discretionary choice for the couple, Cota continued. “It has been — and remains — a necessity and the means by which they support themselves. Pretrial detention without bail is therefore justified.”
A judge is expected to rule on the bail matter today. Attorneys for the Tarnutzers could not immediately be reached for comment. Their arrest capped a two-and-a-half-year investigation by Santa Barbara officials, with lawyers in other California counties providing sworn statements in support of their prosecution.
The Tarnutzers’ local target was their onetime friend and Montecito neighbor Mystica Fleury, who lost more than $2 million to the couple, officials said. In November 2020, soon after she had received a large divorce settlement, Fleury purchased a property on Owen Road directly next door to the Tarnutzers.
Rick falsely represented to Fleury that he was a licensed contractor while Vonna touted her skills as an interior designer. They told her they employed a crew of workers capable of completing a full remodel of her new home. They said they would perform the renovation at cost, with no markup, and Fleury agreed. “Fleury now understands that this was the first step in the Defendants’ grooming of her,” Cota stated in his motion.
An audit of construction records revealed that the Tarnutzers systematically added $10 to every subcontractor hour billed, charged for hours not worked, and charged for labor and materials they used on their own home. Fleury was therefore over-billed approximately $200,000, while the subcontractors received little to no payment whatsoever.
“At the same time Defendants were stealing from Ms. Fleury related to the remodel project,” Cota alleged, “there was also a parallel scheme being executed against her in which Rick Tarnutzer solicited a $1.75 million ‘investment’ from Fleury.” He guaranteed her a 6 percent return with monthly interest-only payments.
In March 2021, Fleury wired $1.25 million to the Tarnutzers’ personal account, followed by another $500,000 in May. Bank records show that none of Fleury’s funds were invested. Instead, they were used to cover the Tarnutzers’ personal expenses, including paying off large credit card debts and refinancing their two multimillion-dollar homes.
The Tarnutzers’ $5.5 million Montecito home
A review of the couple’s bank accounts revealed Fleury’s money was being cycled from Rick’s personal account into an “American Interiors” business account controlled by Vonna, and then back again. “This pattern of rapid, circular transfers is consistent with established money-laundering patterns,” Cota said. In this case, it was used to create the appearance that American Interiors generated substantial revenue, a false representation that the Tarnutzers’ used in support of high-value mortgage applications, he said.
Court records also detail instances in which the Tarnutzers “borrowed” money from friends and associates across California, only to refuse repayment. One victim in the 1990s allegedly lost nearly $500,000 to the couple in a yacht refurbishment scheme. Another spent 18 years fighting to recover $750,000 of what he thought was a legitimate business opportunity with the Tarnutzers. More recently in 2025, while they were under criminal investigation in Santa Barbara, they solicited and received $590,000 in dubious personal loans from an elderly Orange County couple.
In each case, the Tarnutzers dragged their victims through lengthy and costly court battles, often skipping hearings and blatantly defying court orders. When describing Rick, one Northern California judge said he had never encountered a defendant “who so blatantly thumbs his nose at the Court’s authority.”
“The Tarnutzers’ modus operandi,” Cota explained, “is to ‘borrow’ from individuals and then refuse to repay them, forcing them into costly civil litigation, where their victims, because of the cost of litigation, agree to settle for pennies-on-the-dollar. Fraud is how the Tarnutzers live.”
The couple has refined their methods over decades, Cota said, by presenting a lifestyle of wealth, cultivating relationships of trust in order to steal, using shell accounts to launder funds, and submitting false documentation to lenders and tax authorities. Their conduct in the Fleury case was not an isolated episode, he insisted. “She was only the latest and largest in a long line of victims,” he said.
This is a developing story. Check back for updates.
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