OffshoreAlert
Daily news, documents and intelligence about Offshore Financial Centers and those who conduct business in them that you will not find anywhere else.
RSS Feed Print
Anderson's Ark CPA sentences
Internal Administrator
Posted: Friday, August 12, 2011
Joined: 10/12/2010
Posts: 5780


Posted: 9/19/2005 8:44:33 PM

By: Hunter

FOR IMMEDIATE RELEASE
FRIDAY, SEPTEMBER 16, 2005
WWW.USDOJ.GOV

TAX
(202) 514-2007
TDD (202) 514-1888

TWO CPA’S SENTENCED IN $120 MILLION
INTERNATIONAL TAX SHELTER CASE




WASHINGTON, D.C. - The Department of Justice and Internal Revenue Service (IRS) announced today that Chief U.S. District Court Judge John C. Coughenour sentenced two Anderson’s Ark & Associates (AAA) accountants for aiding and assisting in the preparation and filing of fraudulent income tax returns. Tara LaGrand, of Naples, Florida, was sentenced to 24 months in prison, to be followed by one year of supervised release. Lynden Bridges, of Wheat Ridge, Colorado, was sentenced to 18 months in prison, to be followed by one year of supervised release.

LeGrand and Bridges, each a Certified Public Accountant, were part of AAA, an organization through which fraudulent tax shelters and investment scams were promoted and sold. From 1996 through 2001, AAA had approximately 1,500 clients, nearly 300 of whom reported over $120 million in fraudulent income tax deductions.

“People who participate in tax fraud schemes, including preparing fraudulent tax returns, should expect to be prosecuted, convicted, and sentenced to substantial time in jail,” said Assistant Attorney General Eileen J. O’Connor of the Justice Department’s Tax Division.

In late November-December of 2004, the Justice Department prosecuted 10 AAA promoters and accountants in Seattle, Washington. On December 27, 2004, a jury convicted six defendants: Keith Anderson; Wayne Anderson; Richard Marks; Karolyn Grosnickle; James Moran; and Pamela Moran on charges of conspiracy to defraud the government, mail fraud, wire fraud, money laundering, and aiding and assisting the filing of false tax returns in connection with their promotion and sale of these fraudulent AAA schemes. In April 2005, those six defendants were sentenced to lengthy terms of imprisonment ranging from seven to 20 years. More information about the conviction and sentencing of those AAA defendants may be found on the Tax Division website at .

At the conclusion of the December 2004 trial, the jury was unable to reach a verdict as to Tara LaGrand, Lynden Bridges, and two other defendants. However, all four later pleaded guilty to felony charges, with Tara LaGrand and Lynden Bridges pleading guilty to charges of aiding and assisting the preparation and filing of fraudulent income tax returns. In their plea agreements, they admitted that they each assisted AAA clients by preparing and filing the partnership agreements, promissory notes, and income tax returns required to implement the “Look Back” program-one of two fraudulent schemes promoted by the AAA organization.

Indictments also have been returned against 15 AAA clients nationwide, several of whom have pleaded guilty. Most recently, on September 13, 2005, a jury in Milwaukee, Wisconsin, convicted one AAA client, Glen J. Murphy, of seven counts of filing false tax returns and three counts of willfully failing to file income tax returns. Each of the seven counts of filing a false return carries a maximum penalty of three years imprisonment and a $250,000 fine, while the remaining three counts of willful failure to file each carry a maximum penalty of one year imprisonment and a $100,000 fine.

At the Murphy trial, the government introduced evidence establishing that Murphy became an AAA client and purchased the “Look Back” and “Look Forward” tax evasion programs. These schemes used phony partnerships to create fictitious partnership losses and false business expenses. According to the trial evidence, using the “Look Back” program, Murphy created a fictitious partnership loss in 1997 that eliminated his current tax year obligations and carried back the remainder to the tax years 1994, 1995, and 1996, resulting in a fraudulent tax refund of approximately $60,000. He also used the “Look Forward” program to create false advertising and marketing expenses for his chiropractic business in the 1998-2000 tax years. Murphy also failed to file individual income tax returns for tax years 2001-2003.

Assistant Attorney General Eileen J. O’Connor and John L. McKay, U.S. Attorney for the Western District of Washington, thanked Tax Division Trial Attorneys Corey J. Smith and Krista Tongring, and former Tax Division Trial Attorney M. Kendall Day, who prosecuted the case against the AAA promoters and accountants. Assistant Attorney General O’Connor and Steven M. Biskupic, U.S. Attorney for the Eastern District of Wisconsin, thanked Tax Division Trial Attorney Larry J. Wszalek and Assistant U.S. Attorney, Matthew L. Jacobs, who prosecuted the Murphy case. All thanked the special agents of the IRS, whose assistance was essential to the successful investigation and prosecution of both cases.

Additional information about tax fraud schemes to watch out for may be found on the IRS Criminal Investigation website http://www.ustreas.gov/irs/ci/ <.

Additional information about the Justice Department’s Tax Division and its enforcement efforts may be found at www.usdoj.gov/tax .


 

Jump to different Forum... 

We hunt for red flags in high-value, cross-border finance by monitoring offshore and onshore courts, regulatory actions, offering documents, and other sources - and email you the results.

View Recent Digests

Cayman Court Secrecy: A Huge Red Flag for Foreign Investors & Clients
David Marchant
As any fule kno, the biggest enemy of fraud, corruption, money laundering, and other forms of financial crime is transparency, while their best friend is secrecy. That's why the unprecedented mass sealing of cases that's taking place at the Financial Services Division of the Grand Court of the Cayman Islands is repugnant to anyone with a genuine concern for financial crime.