RAMONA -- A prominent Ramona businessman was arrested on first-degree murder and fraud charges Thursday in connection with a suspected arson fire that killed one of his employees early Halloween morning, authorities said.

James Kurtenbach, 47, was taken into custody outside his business, Stars Gas Station in Ramona, about 7 a.m., Sheriff's homicide Lt. Dennis Brugos said.

Kurtenbach's employee, 24-year-old Joseph Nesheiwat, died following an explosion and fire that gutted Kurtenbach's 4,000-square-foot rental home on North Woodson Drive.

Damage was estimated at roughly $900,000.

Authorities believe Kurtenbach "orchestrated" the incident, Brugos said. The lieutenant declined to elaborate further on the matter, which has become a topic of deep interest in the small town.

Kurtenbach is being held without bail at the county jail. He is scheduled to be arraigned Monday at 1:30 p.m. at El Cajon Superior Court.

Firefighters found Nesheiwat's burned body in the backyard of Kurtenbach's rental home after responding to the fire at 1:30 a.m. Oct. 31. An autopsy later showed he died from burns, smoke inhalation and blast force injuries.

Charges against Kurtenbach include: first-degree murder, false or fraudulent claims, false insurance information, hiding facts related to insurance entitlements, fraud related to unfiled tax returns, failure to pay tax and failure to secure workers compensation payment.

News of Kurtenbach's arrest was greeted with relief by Nesheiwat's mother, Terry Sellers.

"That was the best present God could give," Sellers said by phone from her Ramona home. "I've been sitting here 48 days, counting the days, saying 'God, do your thing' -- he certainly did."

Sellers said Kurtenbach had been "a father figure" to her son. She said she had "no idea whatsoever" why her son was at his house the night of the explosion.

Employees at the gas station, including Kurtenbach's son, Justin, declined to comment on the arrest.

Word of the businessman's arrest spread quickly throughout town. Several residents said Thursday it's too early to judge the man, described as an outgoing if sometimes abrasive figure.

A few called Kurtenbach business-savvy, someone who personally pumped gas for customers during discount specials.

"He's innocent until proven guilty," said Phil McManus, filling up his hauling truck at Stars.

On Dec. 4, a search warrant was served at Stars and at Kurtenbach's Midland Road home in Poway. No information about what was found during the searches was available Thursday.

Public records show that one federal and two state tax liens were filed against Kurtenbach in recent years. In July, he paid $268,864 to be released from a federal tax lien on his Ramona gas station.

This is not the first time Kurtenbach has been in trouble for fraud. In 2006, a Nebraska jury ruled in a civil case that when Kurtenbach was selling a gas station in Omaha in 2000, he provided the potential buyer with fake tax returns that overstated the business's income, according to an article in the Omaha World Herald.

After buying the station, the new owner realized quickly that business was much slower than he expected. When he found the original tax returns stuffed behind some pipes in the gas station's back room, he sued Kurtenbach, the paper reported.

Kurtenbach was ordered to pay the new owner $619,000, the amount by which Kurtenbach overstated the station's worth, an expert at the trial testified.

At Cheers of Ramona, a cozy bar on the edge of town, owner Sean Leahy said the Kurtenbach matter has sparked almost constant conversation.

"It's huge," he added. "Things like that don't happen in Ramona."

Contact staff writer Chris Nichols at (760) 740-5426 or cnichols@nctimes.com. Contact Sarah Gordon at (760) 740-3517 or sgordon@nctimes.com