PROPERTY OWNERS PLEAD NO CONTEST TO TAX EVASION AND UNLAWFUL HOUSING CHARGES

Monterey County District Attorney Jeannine M. Pacioni announced today that Nicolas Mejia Ruvalcaba and Ana Ortiz Ruvalcaba (both age 73) have entered no contest pleas to charges arising from the unlawful and dangerous housing they provided on their 23-acre property in Royal Oaks.

Nicolas Ruvalcaba pled no contest to two felony counts of tax evasion with the aggravated white collar crime enhancement, as well as misdemeanor charges of providing unpermitted housing and failure to maintain workers' compensation insurance. Ana Ruvalcaba pled no contest to misdemeanor tax evasion, providing unpermitted housing, and failure to maintain workers' compensation insurance. The Honorable Mark Hood is scheduled to sentence the Ruvalcabas on September 29, 2026.

The Ruvalcabas concurrently entered into a settlement resolving the People's civil unfair competition lawsuit against them. The civil enforcement action addressed numerous violations, including maintaining dangerous structures unfit for human occupancy, failing to install smoke detectors in occupied structures, operating a public water system without a permit, and performing unlawful grading of slopes, among other violations of law.

Under the stipulated plea agreement in the criminal case and stipulated final judgment in the civil enforcement action, the Ruvalcabas will pay a total of $800,000, which includes $450,000 in victim restitution, $134,560 in unpaid taxes to the California Franchise Tax Bureau, $67,174 in fines and costs to Monterey County Housing and Community Development, $10,588 in costs to the Monterey County Environmental Health Bureau, $10,000 in workers' compensation fines, and $127,678 in civil penalties. Pursuant to the stipulation, the Ruvalcabas must pay the restitution, fines, and penalties within 60 days or the court may appoint a receiver to sell their property to satisfy any remaining amounts.

Both defendants face up to 364 days in county jail, to be determined by the Court at sentencing. Pursuant to the plea agreement, the People will ask the court to sentence Nicolas Ruvalcaba to 240 days jail and four years felony probation, and the People will ask the court to sentence Ana Ruvalcaba to 40 days jail and one year misdemeanor probation.

California Rural Legal Assistance, Inc. (CRLA) filed a private civil action in June 2023 on behalf of affected tenants and provided legal representation to victims throughout the criminal proceedings. The Defendants sought simultaneous resolution of the People's criminal and civil enforcement actions and CRLA's private civil action. Defendants agreed to pay an additional $200,000 to resolve this private action, which takes into account the criminal restitution that will be paid to victims through the criminal case. This settlement remains subject to court approval. Inquiries regarding CRLA's case may be directed to Tyler Sullivan at [email protected].

This case came to light in April 2023, when Monterey County Probation Officer Bianca Castillo went to the Ruvalcabas' 23-acre Royal Oaks property in an attempt to locate a probationer. From the long and winding driveway, Officer Castillo saw greenhouses surrounded by large shrubs but did not see any recognizable housing structures. After obtaining GPS coordinates from the probationer's ankle monitor, Officer Castillo returned to the property, entered the greenhouses, and discovered that rudimentary studio apartments had been constructed inside two of the greenhouses. Officer Castillo found numerous people living in the greenhouse units, which appeared cramped and unsafe. She referred the matter to Monterey County Housing and Community Development (HCD) and Monterey County Environmental Health Bureau (EHB), which responded to the property.

Code Compliance Inspectors Elizabeth Ruiz and Lucy Bernal identified 22 unpermitted dwelling units in the greenhouse structures, all of which were occupied, primarily by local agricultural workers and their families, including families with young children.

During this initial inspection, a tenant alerted the inspectors to additional dwelling units located farther up the property, in an area referred to by the tenant as "the woods." Inspectors subsequently discovered more than 46 additional unpermitted units built in and around a steep slope, surrounded by dense oak trees, and covered with dried brush. These structures could not be seen from the road or the main driveway.

Inspections of the greenhouse and hillside units revealed numerous substandard and dangerous conditions, including significant fire hazards. The units lacked smoke detectors, emergency exits, operable windows, required ventilation, and required heating equipment, in addition to other mechanical, electrical, and safety violations. Inspectors counted approximately 270 people living in the greenhouse and hillside structures. HCD and EHB worked with affected tenants to relocate them to alternative housing and secured required tenant relocation payments from the Ruvalcabas totaling $170,206.

The District Attorney's Office Investigation Bureau conducted a further investigation of this matter in preparation for prosecution. District Attorney Investigator Sarah Jackson led a team of investigators to conduct a full search of the property and interview witnesses. District Attorney Investigator Jennifer Mendoza led the investigation into workers' compensation violations. The following Spanish-speaking investigators interviewed tenants: Pablo Andrade, Nancy Bruno, Alicia Cox, Leo Gomez, Jose Lopez, and John Magana.

Based on documentation recovered at the property, Investigator Jackson and Forensic Auditor Sandra Kyzivat determined that the Ruvalcabas received over $1 million in cash rental payments from tenants between 2020 to 2022, which they failed to report on their tax returns. Kyzivat calculated that the unreported income resulted in $134,560 in evaded tax liability.

Investigators also learned how the Ruvalcabas sought to conceal the unlawful housing from authorities and the public by prohibiting the tenants from having any visitors, prohibiting them from spending time outside while on the property, prohibiting the tenants' kids from playing outside on the property, constantly reprimanding tenants for making noise, and intimidating tenants from disclosing the existence of the housing to county officials, law enforcement, and medical personnel.

The District Attorney's Victim Witness Assistance Program provided support to victims throughout interviews and preliminary hearing in the criminal matter. Victim advocate Mayra Sandoval assisted victims during these proceedings.

District Attorney Jeannine Pacioni said: "The conditions uncovered in this case were not simply unlawful, they put families and children at serious risk. Our office will continue to protect vulnerable County residents and hold accountable those who profit from dangerous living conditions."