FOR IMMEDIATE RELEASE:
TUESDAY - December 2, 2008
NEW BERN - United States Attorney George E.B. Holding announced that RONALD CRUICKSHANK, 60, previously from Durham, North Carolina, was sentenced in federal court on Tuesday, November 25, 2008, by Chief United States District Judge Louise W. Flanagan, to 32 months imprisonment, to be followed by three years of supervised release.
CRUICKSHANK pled guilty on June 12, 2008, to three counts of tax evasion relating to his 2001, 2003 and 2004 federal tax obligations in violation of 18 U.S.C. § 7201. As noted by the Government during various hearings in this case, CRUICKSHANK, a successful business executive, received large salaries during the periods in question. In 2002, CRUICKSHANK worked as an executive at a Raleigh advertising company named Howard Merrill Partners. CRUICKSHANK received approximately $297,132 in taxable income. In 2003, CRUICKSHANK, who became Chief Executive Officer (“CEO”) of a sock manufacturer named Thor Lo Inc. midway through the year, received approximate taxable income of $256,668 in connection with his jobs at Howard Merrill and Thor Lo Inc. In 2004, CRUICKSHANK received approximately $401,658.69 in taxable income from his job as CEO of Thor Lo Inc. and other investments.
Rather than report such income to the Internal Revenue Service (“IRS”), as required by law, CRUICKSHANK paid American Legal Research Institute/American Debt Eliminator for assistance in concealing his income. American Legal Research Institute/American Debt Eliminator, which was operated by Robert Pelletier and Laszlo Horvath, presented seminars in the Raleigh/Cary area and sold illegal tax shelters to persons seeking to evade their income tax obligations. Both Pelletier and Horvath have been convicted of federal charges in connection with their illegal activities.
Using techniques obtained from Pelletier and Horvath, CRUICKSHANK arranged for his executive salary to be paid to nominee trusts, opened bank accounts for such trusts under the name of his mother-in-law, deposited his paychecks into such bank accounts, and then using the money in such bank accounts to pay his personal expenses. During the course of the prosecution, CRUICKSHANK retained the services of “tax avoidance” groups in Florida, Arkansas, Arizona, and California and attempted to impede and obstruct the administration of justice. As a result of such obstructive conduct, the Court enhanced CRUICKSHANK’s sentencing range.
United States Attorney Holding said, “Our office continues in its commitment to enforce tax laws so that people are not allowed to flout their obligation thereby putting more burden on law-abiding citizens.”
The criminal investigation was conducted by the Internal Revenue Service-Criminal Investigation Division. Assistant United States Attorney Dennis M. Duffy prosecuted the case for the United States.
News releases are available on the U. S. Attorney’s web page at www.usdoj.gov/usao/nce within 48 hours of release.