FOR IMMEDIATE RELEASE:
December 12, 2001
Public Affairs Specialist
Phone: 713/567-9334 Fax: 713/718-3389
FORMER CLEAR LAKE DENTIST PLEADS GUILTY TO CONSPIRACY TO DEFRAUD
Al Balboni, Assistant United States Attorney
(Houston) Gregory A. Serres, United States
Attorney for the Southern District of Texas, announced today
that Dr. Eddi Lee, D.D.S., age 51, pled guilty to conspiring
to defraud the United States by filing false federal income tax
returns for the years 1994 through 1997. Lee's former office
manager, Jerry Laws, age 60, also pled guilty to conspiracy to
defraud the United States by assisting Dr. Lee in the preparation
of her false income tax returns.
The conspiracy count alleged that Lee and Laws defrauded the
Internal Revenue Service by impeding the IRS's ability to ascertain,
compute, assess and collect the correct income tax owed by Dr.
Lee. It alleged that Dr. Lee instructed a dental insurance provider,
Denticare, to deposit its payments to her for contract dental
services to a personal bank account she maintained at NationsBank.
It further alleged that Laws conspired with Lee to provide
false monthly deposit summaries of the business account to Lee's
accountants which summaries did not include any of the Denticare
income. It is further alleged that neither Lee nor Laws provided
the Denticare Forms 1099 to the accountants who prepared Dr.
Lee's income tax returns. The indictment goes on to allege that
Dr. Lee purchased a Cayman Island Corporation and opened a Cayman
Island account to further the conspiracy to defraud the IRS.
According to the indictment, Lee filed false personal and corporate
income tax returns for 1994 through 1997 which failed to report
any of the income earned from Denticare.
Lee and Laws admitted during their guilty
pleas that they had conspired to deliberately hide $505,753.00
in Denticare payments from the accountants responsible for preparing
Dr. Lee's income tax returns during those four years. By so
doing, Lee evaded approximately $231,000 in taxes.
Lee and Laws each face a possible sentence
of five years imprisonment, three years supervised release, and
a fine of $250,000. Sentencing is set for March 11, 2002. This
case was investigated by Special Agents of the Internal Revenue
Service and is being prosecuted by the United States Attorney's