Tuesday, March 9, 2010
Department of Justice
United States Attorney James R. Dedrick Eastern District of Tennessee
FEDERAL JURY CONVICTS EDWARD K. EASTWOOD AND ELINA GROMOVA EASTWOOD ON CONSPIRACY, TAX EVASION, FALSE STATEMENTS, AND FINANCIAL TRANSACTION STRUCTURING CHARGES
GREENEVILLE, Tenn -Following a nine-day trial in United States District Court, Greeneville, Tennessee, a jury convicted Edward K. Eastwood and Elina Gromova Eastwood of Greeneville, Tennessee of federal conspiracy, tax evasion, false statements, and financial transaction structuring charges.
Sentencing is set for September 20, 2010, at 1:30 p.m. Both defendants were detained pending their sentencing. Edward Eastwood faces a potential term of imprisonment of 30 years and a potential fine of $1.1 million dollars. Elina Gromova Eastwood faces a potential term of imprisonment of 20 years and a potential fine of $850,000. In addition, the defendants may be ordered to pay the federal income taxes as restitution.
The evidence presented at trial demonstrated that Edward Eastwood was a Certified Registered Nurse Anesthetist who traveled to Bishkek, Kyrgystan in 1997, to marry Elina Gromova, a citizen of the Republic of Kyrgystan (a former Soviet Republic). In 1998, Gromova traveled to the United States and married Eastwood. During the next eight years, Eastwood earned more than $700,000 in income, filed Tax Defier Zero Tax Returns, and failed to pay any federal income taxes. He also systematically transferred all of his assets (including cash, gold, cars, trucks, trailers, and real estate) to his wife, who has never registered with the Social Security system. As a result of routine tax collection procedures, Elina Gromova Eastwood initiated civil litigation in federal district court. During the process of that civil litigation, both defendants submitted materially false statements regarding the existence and ownership of assets and the existence of books and records.
A storage locker rented by Edward Eastwood under another name disclosed the existence of 76 ounces of gold, numerous semi-automatic weapons and thousands of rounds of ammunition, and books and records of account of Edward Eastwood. Information ultimately led to the discovery of an undisclosed bank account in the name of a sham trust, which led to the discovery of nominee-owned real estate and an additional 273 ounces of gold. 222 ounces of the gold acquired by the defendants remain unaccounted.
The jury convicted both defendants of conspiring to defraud the United States by dishonest means in violation of Title 18, U.S.C., §371; evasion of payment of federal income taxes in violation of Title 26, U.S. C., §7201; making false material declarations in violation of Title 18, U.S.C., §1623; and as to Edward Eastwood, structuring a financial transaction to avoid the issuance of a currency transaction report in violation of Title 18, U.S.C., §5324.
James R. “Russ” Dedrick, United States Attorney for the Eastern District of Tennessee stated that “Tax Defiers and others who refuse to accept the burdens of citizenship along with its benefits cannot hide behind constitutional challenges to the income tax laws, which have been validated and affirmed by every court in the land. Individuals who choose to willfully evade the payment of their federal income taxes will be prosecuted within the full extent of the law.”
Christopher R. Pikelis, IRS Criminal Investigation Special Agent in Charge of the Nashville Field Office stated that “This verdict sends a clear message that tax evasion is a serious crime against the American public. To ensure confidence in our tax system, the Service has a responsibility to investigate and prosecute individuals who intentionally violate the nation’s tax laws. As the 2010 filing season moves into high gear, it is important that honest, hardworking citizens know we are working diligently to ensure that they are not bearing the burden of someone else’s tax liability. This is not a victimless crime.”
Law enforcement agencies participating in the joint investigation which led to indictment and subsequent conviction of Edward K. Eastwood and Elina Gromova Eastwood included IRS-Criminal Investigation; the Federal Bureau of Investigation; the Department of Homeland Security Citizenship and Immigration Service; the Greene County Sheriff’s Office, and the Morristown Police Department. Assistant U.S. Attorney Helen Smith represented the United States