WASHINGTON – The three founders of the Institute of Global Prosperity (IGP), David Struckman, Daniel Andersen and Lorenzo Lamantia, were sentenced Monday by U.S. District Judge Robert M. Takasugi in Seattle to prison terms for various tax crimes committed while partners in IGP, the Justice Department and Internal Revenue Service (IRS) announced. Two other principals of IGP, Dwayne Robare and Kuldip Singh, were also sentenced for their respective tax crimes.
David Struckman, a former resident of Renton, Wash., was sentenced to 70 months in prison and $2.9 million in restitution after being tried and convicted of conspiracy to defraud the United States and tax evasion. Struckman moved to Panama prior to his indictment in 2004 and was deported back to the United States by Panamanian authorities in January 2006.
Daniel Andersen, who resided in Leominster, Mass., and Oxnard, Calif., was sentenced to 30 months imprisonment after pleading guilty to conspiracy to defraud the United States in July 2004. Andersen cooperated in the investigation and testified on behalf of the government at the trial of Struckman in November 2007.
Lorenzo Lamantia, a former resident of Mountain Ranch, Calif., was sentenced to 27 months in prison after pleading guilty to conspiracy to defraud the United States and tax evasion in December 2005. Lamantia cooperated in the investigation and testified on behalf of the government at the trial of Struckman in November 2007.
Dwayne Robare, a resident of Leominster, Mass., who became affiliated with IGP in 1997, and maintained IGP’s teleconferencing system, was sentenced to three years of probation after pleading guilty to tax evasion in April 2005. Robare cooperated in the investigation and testified on behalf of the government at the trial of Struckman in November 2007.
Kuldip Singh, common-law wife of Lamantia and former resident of Mountain Ranch, Calif., was sentenced to three years of probation after pleading guilty to wilfully failing to file tax returns in December 2005.
According to documents filed with the court and evidence introduced at trial, IGP sold "wealth building" products through audiotapes, CDs and tickets to offshore seminars. The proposed wealth-building methods marketed to clients included placing client assets into purported foreign and common law "trusts" while maintaining control of the assets. The products were sold to clients for $1,250 and tickets to attend domestic and offshore seminars were sold at prices ranging from $6,250 to $37,000 each.
IGP generated gross receipts of over $45 million from the sale of "wealth building" products from its inception in the fall of 1996 to May 2002. As the original co-founders of IGP, Struckman and Andersen received partnership income totaling $7.9 million each during IGP’s existence. Lamantia, who became a partner in IGP in July 1998, received partnership income totaling $4.3 million.
Struckman, Andersen and Lamantia maintained the anonymity of IGP by changing the name of the business, using mail drops to conceal its location, conducting financial transactions in cash, and discouraging the use of Social Security numbers to escape notice by the IRS. All five defendants concealed personal income earned from IGP. Each placed personal income in a secondary series of bogus trusts, nominee entities and offshore bank accounts.
None of the five defendants reported the income they earned to the IRS and none filed individual income tax returns, trust tax returns, partnership returns or declared a financial interest in, or signature authority over, a foreign bank account as required by law.
"The Department will use all of its tools to identify those who promote or engage in schemes to conceal assets and income in order to evade taxes," said Nathan J. Hochman, Assistant Attorney General for the Tax Division. "We want to make it clear to everyone that there are severe consequences for cheating on your taxes, including felony indictments, imprisonment and steep fines."
Several other members of IGP have previously been convicted of tax crimes. In February 2003, Margo Jordan, an IGP retailer from Wilton, Maine, pleaded guilty in Portland, Maine, to tax evasion. In May 2003, Jeffrey and Shoshanna Szuch of Charleston, S.C., who respectively served as Seminar Coordinator and Director of Operations for IGP, pleaded guilty in South Carolina to charges of tax evasion. Also in May 2003, Laura J. Struckman, the wife of defendant David Struckman, was tried and convicted in Seattle of conspiracy to structure a financial transaction. In February 2006, Becky Coggins of Leominster, Mass., who served as office manager for IGP, pleaded guilty in Boston to submitting false documents to the IRS. In January 2007, Nadine Griffin, formerly of Danvers, Mass., and one of the top IGP retailers, was sentenced after being tried and convicted in Boston of filing a false tax return.
In addition, numerous vendors who marketed tax evasion products at IGP offshore seminars have plead guilty or been convicted of tax crimes. These vendors include Anderson’s Ark & Associates; Innovative Financial Consultants; Millennium Publishing; John David Van Hove, a/k/a, Johnny Liberty; Advanta Strategies and World Contractual Services; and LAD Financial Services Inc.
"The IRS is very focused on taxpayers who cheat on their taxes by hiding their assets offshore," said IRS Commissioner Doug Shulman. "These sentencings send an important signal about our efforts involving offshore tax evasion and elaborate schemes to avoid detection. We will work aggressively to use all of our legal and investigative tools to stop this abuse."
Assistant Attorney General Hochman thanked Tax Division trial attorneys Larry J. Wszalek, Michael J. Watling and former Tax Division trial attorney Mark T. Odulio who prosecuted this case. He also thanked the special agents of the IRS whose assistance was essential to the successful investigation and prosecution of this case.
Additional information about IGP and the injunction entered against one of its directors in 2006, can be found at http://www.usdoj.gov/tax/txdv06436.htm. Further information about the Justice Department’s Tax Division and its enforcement efforts may be found at www.usdoj.gov/tax.