It took the IRS and DOJ a few years, but they finally started getting indictments and convictions against 1099-OID and other scammers who used very clever ways of cheating on the taxes.
Incidentally, you should not take my expressed disdain for the scammers as an indication that I believe they actually owed any income tax because I don't. However, the scammers used an utterly crooked way to get out of paying the tax AND of getting refunds of far more money than they would have deserved with a traditional tax return.
After tolerating years of the scammers' bogus seminars to teach crooked methods and of preparing and filing fraudulent documents, the government got indictments and convictions of the infamous Timothy Turner (of the Restore America Plan scam) and Glen Unger, AKA Dr. Sam Kennedy. Today those scammers live in federal prisons, right where they belong.
And now Winston Shrout will soon join them because the government just won a conviction against him for his own brand of scams. See the articles below.
To all who hate the income tax: beware of preparing or filing false or fraudulent documents in an effort to avoid or evade income tax.
NEW DOCKET ENTRY at end of September 2018:
Minutes of Proceedings: Competency Hearing before Judge Robert E. Jones as to Winston Shrout. Two witnesses sworn and evidence adduced. The Court finds the defendant competent to proceed to sentencing. Sentencing is schedule for October 22, 2018 at 10:00AM before Judge Robert E. Jones. (Note: Sentencing is scheduled for two hours.)Counsel Present for Plaintiff: Stuart Wexler, Lee Langston. Counsel Present for Defendant: Ruben L. Iniguez. (USPO Present: Chris Song, PreTrial) (Court Reporter Jill Jessup) (bp) (Entered: 09/27/2018)
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Department of Justice
Office of Public Affairs
FOR IMMEDIATE RELEASE
Friday, April 21, 2017
Oregon Promoter Convicted for Making, Passing and Sending Bogus Financial Instruments to U.S. Treasury and Financial Institution and Failing to File Tax Returns
A Hillsboro, Oregon promoter was convicted today following a jury trial of making, passing and submitting fake financial instruments to a financial institution and the U.S. Treasury and failing to file tax returns, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department's Tax Division.
According to the superseding indictment and the evidence presented at trial, from approximately 2008 through 2015, Winston Shrout, 69, formerly of St. George, Utah, created and submitted more than 1000 bogus financial instruments with the intent of defrauding financial institutions and the U.S. Treasury. Shrout held seminars and private meetings to promote and market the use of these fake financial instruments to pay off debts, including federal taxes. Shrout sold recordings of his seminars, templates for fake financial instruments and other materials through his website.
The evidence presented at trial also proved that Shrout failed to file his 2009 through 2014 tax returns despite earning $562,224 from presenting at seminars, licensing fees associated with the sale of his products and annual pension payments.
Sentencing is scheduled for Aug. 1. Shrout faces a statutory maximum sentence of 25 years in prison for each count of making a fake financial instrument and one year in prison for each count of failing to file a tax return. He also faces a period of supervised release, restitution and monetary penalties.
Acting Deputy Assistant Attorney General Goldberg commended special agents of IRS–Criminal Investigation, who conducted the investigation, and Trial Attorneys Stuart Wexler and Lee Langston of the Tax Division, who prosecuted the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division's website.
17-445
Topic:
Tax
Updated April 21, 2017
https://archives.fbi.gov/archives/mobile/press-releases/2013/self-proclaimed-president-of-sovereign-citizen-group-sentenced-to-federal-prison-for-promoting-tax-fraud-scheme
Self-Proclaimed President of Sovereign Citizen Group Sentenced to Federal Prison for Promoting Tax Fraud Scheme
| U.S. Department of JusticeJuly 31, 2013 |
WASHINGTON—The Justice Department, the Internal Revenue Service (IRS), and the FBI announced today that James Timothy Turner, also known as Tim Turner, was sentenced to serve 18 years in federal prison for conspiracy to defraud the United States, attempting to pay taxes with fictitious financial instruments, attempting to obstruct and impede the IRS, failing to file a 2009 federal income tax return, and falsely testifying under oath in a bankruptcy proceeding.
In March 2013, following a five-day jury trial, Turner was convicted on 10 counts in the U.S. District Court for the Middle District of Alabama. Based on the evidence introduced at trial and in court filings, Turner, the self-proclaimed "president" of the sovereign citizen group Republic for the united States of America (RuSA), traveled the country in 2008 and 2009 conducting seminars teaching attendees how to defraud the IRS by preparing and submitting fictitious bonds to the U.S. government in payment of federal taxes, mortgages, and other debt. The evidence at trial revealed the bonds are fictitious, and witnesses testified that Turner used special paper, financial terminology, and elaborate borders in an effort to make them look authentic and more likely to succeed in defrauding the recipient. Turner was convicted of sending a $300 million fictitious bond in his own name and of aiding and abetting others in sending 15 other fictitious bonds to the Treasury Department to pay taxes and other debts.
The evidence at trial also established that Turner taught people how to file retaliatory liens against government officials who interfered with the processing of fictitious bonds. Turner filed a purported $17.6 billion maritime lien in Montgomery County, Alabama Probate Court against another individual. This investigation began after Turner and three other self-proclaimed "Guardian Elders" sent demands to all 50 governors in the United States in March 2010 ordering each governor to resign within three days to be replaced by a "sovereign" leader or be "removed." The FBI immediately began investigating Turner and IRS- Criminal Investigation (IRS-CI) joined the investigation soon thereafter.
"This lengthy prison sentence shows that tax defiers like Turner who use bogus tax schemes and file retaliatory liens against government officials will be punished," said Assistant Attorney General for the Justice Department's Tax Division Kathryn Keneally. "The Justice Department will continue to work with law enforcement to investigate and prosecute those who attempt to defraud the government."
"This sentence should send a message that if you attempt to use retaliatory tax liens and fraudulent tax schemes as weapons against the United States and its citizens you will be punished," stated acting U.S. Attorney Sandra J. Stewart for the Middle District of Alabama. "We cannot and will not tolerate those who violate the law for financial gain. I would like to thank the law enforcement officers who worked vigilantly on this case to bring this criminal to justice."
"Turner influenced others with his false ideology by aggressively promoting obstruction of the IRS," stated Richard Weber, Chief, IRS-Criminal Investigation. "In truth, Turner's own defiance of IRS and his attempts to lead others through the same labyrinth of lies and distortions led to his downfall as shown by the significant sentence he must now serve. Today's sentence should also send a strong message to those who may follow in Turner's footsteps and attempt to defy their tax obligations. The legality of our income tax laws has been challenged time and time again and the courts have consistently upheld them."
"The FBI is committed to vigorously investigate individuals and groups who steal from the federal government for financial gain through schemes deigned to avoid payment on loans, taxes, and other obligations owed the federal government," stated Stephen Richardson, Special Agent in Charge of the FBI, Mobile Division.
In addition to prison time, Turner was ordered to pay $26,021 in restitution to the IRS and to serve a five-year term of supervised release upon his release from prison.
This case was investigated by special agents of the FBI and IRS-CI and was prosecuted by Tax Division Trial Attorney Justin Gelfand and Middle District of Alabama Assistant U.S. Attorney Gray Borden.
Former Orthodontist Convicted of Attempting to Scam the IRS of $36 Million
| U.S. Attorney's OfficeOctober 21, 2013 |
ALBANY, NY—Richard S. Hartunian, United States Attorney, Northern District of New York, announces that on October 21, 2013, before Senior U.S. District Court Judge Tomas J. McAvoy, a jury convicted Glenn Richard Unger (62, of Ogdensburg, New York) of the following offenses: obstructing and impeding the Internal Revenue Service (IRS); filing false claims against the United States; tax evasion; and passing fictitious obligations.
The evidence at trial showed that Glenn Richard Unger engaged in a multi-year scheme to obstruct and impede the IRS by filing numerous false and fraudulent claims with the IRS for payment of a refund of taxes totaling approximately $36 million. Between 2007 and 2011, Glenn Richard Unger filed 14 false tax returns claiming that he earned substantial income reported on IRS Forms 1099-OID, had substantial withholdings on that income, and was entitled to $36 million in tax refunds. Despite numerous warning letters from the IRS that his returns were frivolous, he continued filing false tax returns.
In addition to obstructing the IRS by filing false and fraudulent claims for refund, the evidence at trial also showed that Glenn Richard Unger attempted to evade payment of taxes he owed to the IRS. During 2004 and 2005, Glenn Richard Unger earned income and failed to file tax returns reporting that income. The IRS assessed taxes for those two years and also assessed penalties for filing frivolous tax returns. After the IRS filed a tax lien against Glenn Richard Unger, the defendant attempted to file a false document with the Saratoga County Clerk's office attempting to release the lien. Evidence at trial also showed that Glenn Richard Unger tried to pay off a debt to another orthodontist with a fictitious document purported to be worth $200,000.
As a result of the conviction, the defendant is facing a statutory maximum term of imprisonment of 25 years and a maximum fine of $250,000. Sentencing is scheduled for March 10, 2014 in Albany, New York.
This prosecution resulted from an investigation conducted by the Internal Revenue Service, Criminal Investigation, New York Field Office; the Federal Bureau of Investigation, Albany Field Office; the New York State Police, and the Treasury Inspector General for Tax Administration. The case was prosecuted by Assistant United States Attorney Ransom P. Reynolds (Northern District of New York) and Jeffrey Bender (Department of Justice Tax Division).
