FOR IMMEDIATE RELEASE |
FRIDAY, MARCH 18, 2005
TDD (202) 514-1888
UTAH CORPORATE EXECUTIVES AND LEGAL COUNSEL CONVICTED OF TAX FRAUD
Defendants Concealed Income And Gave False Information To The Irs
WASHINGTON D.C. - Eileen J. O’Connor, Assistant Attorney General for the Tax Division, United States Department of Justice, Paul M. Warner, U.S. Attorney for the District of Utah, and Nancy J. Jardini, Chief, IRS Criminal Investigation announced that a federal jury in Salt Lake City, Utah today convicted Thomas E. Mower, Leslie D. Mower and James Thompson of conspiracy to defraud the IRS (18 U.S.C. §371). Mr. and Mrs. Mower were also convicted on charges of income tax evasion (26 U.S.C. § 7201), and Mr. Thompson was also convicted on a charge of corruptly impeding the due administration of the internal revenue laws (26 U.S.C. §7212(a)). U.S. District Judge Dale A. Kimball scheduled sentencing for June 21, 2005.
“Honest taxpayers deserve to know that people who commit tax crimes will be held accountable,” said Eileen J. O’Connor, Assistant Attorney General for the Tax Division.
“The prosecution of individuals who intentionally conceal income and evade taxes is a vital element in maintaining public confidence in our tax system,” stated Nancy J. Jardini, IRS Chief, Criminal Investigation Division. “Today's conviction sends a clear message that the IRS is committed to vigorously enforcing the tax laws.”
According to the indictment and the evidence introduced at trial, the Mowers founded, co-owned and controlled Neways, Inc., an international multi-level marketing company based in Salem, Utah. Mr. Mower was the Chief Executive Officer, Mrs. Mower was the Chief Financial Officer and both also served as company directors. Mr. Thompson was employed as corporate counsel for Neways, Inc. from the fall of 1995 through the summer of 1997. The defendants devised and executed a scheme to conceal from the IRS more than $1 million of Neways, Inc.’s gross receipts received from Neways Australia, as well as more than $3 million of commission income the Mowers received from distributorships in the multi-level marketing structure of their United States, Australian and Malaysian companies. In furtherance of the scheme, Mr. Thompson created and presented a false and fraudulent loan document and made false and fraudulent statements to an IRS Special Agent to hide the Mowers’ commission income.
The maximum penalty for each count of conspiracy and tax evasion is five years imprisonment followed by up to three years supervised release, and a fine of $250,000. Defendants convicted of tax evasion may also be required to pay the costs of prosecution. The maximum penalty for the charge of corruptly impeding the IRS is three years imprisonment followed by up to one year of supervised release, and a fine of $250,000.
Assistant Attorney General O’Connor and U.S. Attorney Warner thanked Tax Division Trial Attorneys Caryn Mark, Edward Power and John Sullivan, who prosecuted the case. They also thanked the special agents of the Internal Revenue Service whose assistance was essential to the successful investigation and prosecution of the case.