FOR IMMEDIATE RELEASE|
THURSDAY, FEBRUARY 06, 2003
TDD (202) 514-1888
JUSTICE DEPARTMENT SEEKS COURT ORDER TO STOP FORMER
ACCOUNTANT, ASSOCIATE FROM PROMOTING NATIONWIDE TAX SCAM
Court Papers Allege Two Ohio Men Sold Sham-Trust Packages
to Insurance Agents and Others, Evading Over $30 Million in Tax
WASHINGTON, D.C. – The Justice Department filed papers in federal court in Cincinnati today asking for a court order to stop two Ohio men, Wilson M. Graham and Homer Richardson, from promoting a sham trust scheme. The scheme was allegedly used by their clients across the country to cheat the government out of tens of millions of dollars in income taxes. The illegal trust was designed by the Aegis Company of Palos Hills, Ill.; additional information on the designer can be found at http://www.usdoj.gov/usao/flm/pr/012703income.pdf.
Graham and Richardson allegedly targeted their sham-trust pitch at agents of a major insurance company and other self-employed people. The two enticed individuals with false promises that they could "legally" reduce their income taxes by more than 70 percent a year and eliminate capital gains and estate taxes.
"Many self-proclaimed tax experts claim you can avoid your tax obligations by using trusts," said Eileen J. O'Connor, Assistant Attorney General for the Justice Department's Tax Division. "These tax scammers are setting up themselves and their customers for serious trouble."
"The Internal Revenue Service and the Tax Division have made it a priority to shut down tax scam promoters and to hold them and their customers accountable," added Assistant Attorney General O'Connor.
According to the government's motion for preliminary injunction, Graham is an ex-convict whose Ohio accounting license had been revoked. The court papers also allege that Graham has also prepared an estimated 380 fraudulent tax returns for clients based on the trust scam. People who bought sham-trust packages promoted by Graham and Richardson allegedly have failed to pay over $30 million in taxes that they owe.
Last year, the Justice Department brought a similar lawsuit against an Ohio return preparer, certified public accountant Robert Welti. A federal magistrate judge has recommended that Welti be barred from preparing federal income tax returns.
Tax evasion scams cost taxpayers billions of dollars every year. According to a General Accounting Office report (GAO-02-733) issued last year, however, stepped-up efforts by the IRS and Justice Department to crack down on these scams have led to increasing numbers of convictions of tax fraud promoters. The report can be found online at http://www.gao.gov/new.items/d02733.pdf.