July 20, 2001

Norma Estimbo Lacy
Public Affairs Specialist
Phone: 713/567-9388 Fax: 713/718-3389


Al Balboni, Assistant United States Attorney
Phone: 713-567-9726

(HOUSTON) Gregory A. Serres, United States Attorney for the Southern District of
Texas, announced today that Vernard Wrotten, age 51, pled guilty to one count of conspiracy to defraud the Internal Revenue Service for aiding in the filing of false and fraudulent income tax returns. Wrotten was the creator and owner of Westlight Financial Strategies, a company that held itself out as a financial services company. Two former employees of Westlight, Randolph Corbitt, age 44, and Doyle Smart, age 33, also pled guilty to one count of conspiracy. All three men admitted that they prepared false returns using fictitious businesses allegedly run by their clients to generate large tax refunds. Wrotten admitted he created a presentation binder which aided Corbitt and Smart in persuading potential clients that they were entitled to deduct personal or non-existent expenses as legitimate business or farm expenses. The potential clients did not have an ongoing business or farm at the time they were approached by Wrotten and the others.

Wrotten, Corbitt, and Smart made presentations to potential clients that lasted sometimes as long as 4-5 hours. During the presentation, Wrotten and the others would ascertain what hobbies the potential client engaged in, or wished to engage in, and would convince them that they were in fact already in business and that they had deductible expenses associated with the business for the current year. Wrotten, and the others, would then tell them he had to amend their tax returns for the prior two years to claim the same type of business or farm expenses in those years. The indictment alleges that Wrotten, Corbitt, and Smart conspired to aid the filing of approximately 530 false income tax returns for the years 1994 through 1996. The defendants admitted that the total tax harm to the United States exceeded $1,000,000.

Wrotten, Corbitt, and Smart each face a possible sentence of five years imprisonment, three years supervised release, and a fine of $250,000. This case was investigated by Special Agents of the Internal Revenue Service and was prosecuted by the United States Attorney's Office.

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