In the end, Anne Sholtz’s punishment for defrauding the visionary smog-credit market she helped design played out much like her entire federal prosecution: with the belief that there was far more to her case than a simple white-collar swindle.

U.S. District Judge Audrey Collins sentenced Sholtz on April 14 to one year of home detention and five years of probation. Collins said the fact that federal prosecutors only charged Sholtz with a single felony count, combined with a recent US Supreme Court ruling, prevented her from socking Sholtz with jail time. Under previous sentencing guidelines, she could have received a maximum five-year term.

In a brief interview, Assistant US Attorney Joseph Johns expressed unhappiness with the ruling and said his office was mulling an appeal. The Justice Deptartment had focused on what it believed was its best evidence against Sholtz — a fraudulent deal involving one of the world’s biggest oil companies. She had pled guilty to that charge in April 2005.

“I’ve been prosecuting environmental crimes for 18 years and this stands out as the single exception to pleading a defendant out to your most significant count,” Johns said. “I’ve never had a case like this when the obvious strategy wasn’t the winning one. Had we known the court wouldn’t agree with our theory, we would’ve handled this differently. We see this as a prison case.”

Sholtz’s attorney, Richard Callahan, did not respond to calls seeking comments.

Overall, the US Attorney’s Office has divulged little about their case against Sholtz, now roughly 43, or her defunct companies, EonXchange and Automated Credit Exchange. Despite a raft of delays with her sentencing, the Justice Department did not issue a press release about it or provide details about what related schemes they uncovered.

Prosecutors had received evidence of 82 potential counts of wire fraud, mail fraud and false statements, one person knowledgeable about the investigation confirmed. Dorothy Kim, the other federal prosecutor assigned to the case, had no comment.

Computer businessman Seth Brandes was one of several former Sholtz clients who attended the sentencing in downtown Los Angeles to look her in the face. The money he lost to her, he said, was “a good chunk of my retirement nest egg.”

Brandes said Sholtz sobbed as she read a statement to the judge in what he characterized as a “heartfelt, wonderful performance.” She talked about a car accident that killed one of her relatives, and an ill mother who’d face hardship if she went to prison, several sources said.

“When somebody comes and steals your money, you want either your money back or them prosecuted for their crime,” Brandes said. “There were 60-odd names in the bankruptcy, and few of them were interviewed by the US Attorney’s Office.”

During the 1990s, Sholtz had been a young virtuoso in the budding world of pollution credit trading. She was one of the few women involved, and a breed apart from other so-called smog brokers. She had ties to Caltech and large financial institutions, claimed to hold a PhD and impressed with her expertise in Web-driven trading. When the South Coast Air Quality Management District established its trailblazing Regional Clean Air Incentives Market, or RECLAIM, Sholtz won plaudits for her input.

Okayed in 1993, RECLAIM helped pave the way for today’s carbon markets. Instead of traditional “command-and-control” regulations, the program allots to refiners, power plants and other large manufacturers a yearly distribution of credits for their emissions of pollution-forming nitrogen- and sulfur-oxides. Local companies that reduce their discharges, typically by installing cutting-edge equipment, can sell unused credits to firms that need them. Last year there were $74 million in trades; typically, brokers pair buyers and sellers.

Before federal agents busted her, the engaging Sholtz lived well in an 8,000-square-foot estate along the San Gabriel Mountain foothills. It was a short freeway drive from the hip Pasadena office lined with flattering media stories about her.

It all began unraveling in July 2002, when the AQMD notified the federal Environmental Protection Agency about complaints from nine companies alleging that Sholtz’s companies had defrauded them of millions of dollars, documents show. When federal agents arrested her at her gym, and word spread that she didn’t have a PhD, among other surprises, shock waves radiated. Environmental regulators once cozy with her felt betrayed or embarrassed, and the AQMD enacted new trade-oversight rules.

Investigators soon zeroed in on her transactions with AG Clean Air, a New York-based investment firm, and what is now ExxonMobil Corp. In 1999, she convinced AG that Mobil needed $17.5 million in credits to comply with RECLAIM. In truth, there was no deal with ExxonMobil, and Sholtz admitted fabricating faxes and email from the oil giant to persuade AG the transaction was valid.

In her deceptions against AG, Sholtz claimed she had an ExxonMobil contract signed by a man named Jason Hebert. Investigators, however, found ExxonMobil had never employed him. Rather, he worked for Intergen North America, another one of her clients.

A week after the Sept. 11 terrorist attacks, Intergen itself was so nervous about the $4.5 million it had paid Sholtz for credits it needed for a proposed Palm Springs-area power plant that it took action. Hebert’s boss flew his private plane, with Hebert along, from Texas to Pasadena to confront Sholtz, Hebert said. Once there, she told them about a hitch with the deal, reassuring them she’d iron out things if they were patient.

Hebert said Sholtz exuded a calm, professional air, but felt her explanation was a “runaround” that might well cost him his job. “You lose $4.5 million to an individual and you think you are going down the tubes,” Hebert said. “We told her give us our credits or give us our fucking money. It was that simple.”

Herbert’s sinking feeling deepened when Sholtz offered one reason why she couldn’t do either immediately. “She said she was working with another broker to clear the deal and they sustained great losses when the World Trade Towers went down,” Hebert recalled. “Someone using 9/11 as an excuse a week after it happened sounded completely plausible. Now you look back and say, ‘How could you do that?’ She was fabricating everything.”

Eventually, Intergen sued Sholtz and EonXchange. At the time, chaos gripped the energy markets because of the al Qaeda strikes and the rolling California power crisis that fueled the recall of Gov. Gray Davis. When federal agents notified Hebert in 2003 that Sholtz had represented he worked at ExxonMobil, he described feeling “speechless.”

“She should spend time in prison,” he said.

Collins, several people at the sentencing said, praised Sholtz’s attorney while criticizing federal prosecutors for only filing one charge. A US Supreme Court ruling handed down after Sholtz’s plea but before the sentencing now prevents lower judges from using evidence of uncharged criminal activity in meting out punishment. That Sholtz had repaid AG also influenced the judge, though it’s not clear the claim was settled at sentencing time.

Lawyer and businessman William Greenberg made some money with Sholtz, but now has a judgment against her in excess of $1.5 million. In a letter to the judge, Greenberg said the losses hit him so hard he and his wife worried about losing their home and declaring personal bankruptcy.

“Before meeting Sholtz, I had never met a person without a conscience,” Greenberg wrote. “I hope that the sentence you impose will reflect some measure of justice, taking into account the mental pain and anguish experienced by the victims she has injured with astonishing and callous indifference …”

With the prosecution seemingly over, there are unanswered questions galore. Why didn’t the government bring charges against her for the “Ponzi” and international financial schemes uncovered in the investigations? Why also were the accusations of so many other ex-clients excluded?

AQMD spokesman Sam Atwood said the agency was disappointed in the sentence because of the need “to maintain the credibility of” RECLAIM. Atwood called Sholtz’s misdeeds “a significant bump in the road.”

Johns, the prosecutor, countered that the other evidence was “difficult” to prove and wouldn’t have added much to a prison term.

“At the end of the day she lost everything — her friends, respect of the businessmen in this rapidly growing field …” he said. “She will always be a convicted felon and narrowly missed going to prison.”

Paralleling her criminal prosecution has been a complicated bankruptcy filing, where claims by ex-clients and debtors may exceed $80 million. Recently, the lawyer for the court-appointed trustee said that there’s only about $6 million left to pay off remaining creditors.