Thursday, March 8, 2012

Tax Practitioner Self-help Defense Fails (3/8/12)

Criminal defense attorneys are always thinking about ways to win their cases.  Defendants also have a keen interest in winning.

One of the best defenses is to neutralize key prosecution witnesses.  But there are ways to do that and not to do that.  This blog is about a way not to do that.  It from the following article Calif. tax preparer accused of ordering hit on 2 (CBS News 3/6/12), here.  The balance of this blog reports the article.  I have no independent knowledge of the events described.

A tax practitioner -- a former IRS agent -- operated a tax preparation business for the wealthy.  In at least some instances, he had wealthy clients who were inattentive, permitting him to steal large amounts of money from them.  The article is cryptic about precisely he managed to steal the money in a tax practice, but apparently he would present a return to the clients showing a very large tax bill, convince the clients that they should deposit the tax into his account so that he could write the check to the IRS, and then file false returns showing much less liability and paying that smaller amount.  He would pocket the difference.  I am not sure that is exactly how it worked in all cases, because there is another statement in the article that he filed a return for a client reporting $ 42.1 million when the client's income was only -- get this, only -- $20.7 million.  I am not sure how he would get his money by reporting more tax than he got from the client.  Still, somehow, allegedly, he did stole from his clients.  He was indicted on multiple clients of fraud.  Not tax fraud; just fraud for defrauding clients.

So, the tax practitioner attempted some self help.  Not just neutralize, but eliminate the key witnesses against him.  According to the article, he stands "accused of ordering at least two former customers killed as they prepared to testify against him on fraud charges."

One notable quote from his attorney:  "I find it almost impossible to believe."  (I suppose this was the attorney in the pending fraud case, perhaps pressed into interim service also on the witness tampering charge (although I suspect he would be disqualified from representing him in that case.)

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