November 15, 2012
Department of Justice
United States Attorney William C. Killian Eastern District of Tennessee
Former Knoxville Attorney Found Guilty Of Income Tax Evasion
KNOXVILLE, Tenn. - John Threadgill, 69, of Knoxville, Tenn., was convicted on Wednesday, November 14, 2012, by a jury in U.S. District Court, Knoxville, on one count of income tax evasion. The Honorable Thomas W. Phillips, U.S. District Judge, scheduled Threadgill’s sentencing for March 14, 2012, where he could face a maximum penalty of five years in prison and fine of $250,000.
Threadgill was indicted in June 2011 and charged with one count of income tax evasion. According to the indictment, Threadgill failed to pay more than $1.4 million in tax to the Internal Revenue Service (IRS) for numerous tax years from 1985 through 2004. The indictment further alleged that Threadgill used his law firm bank account and payroll account to pay for personal expenditures, opened bank accounts in the names of nominee trusts, and titled his personal residences in the names of nominee trusts.
On June 6, 2012, the Tennessee Supreme Court disbarred Threadgill and ordered him to pay restitution of $266,183.40 to seven former clients.
During the five-day trial, the United States presented evidence of Threadgill’s earnings, along with proof that he had made more than $909,000 in personal expenditures with funds that could have been used to pay his taxes. The United States demonstrated that during the years at issue, Threadgill spent more than $69,000 for his daughter’s wedding, $245,000 for family educational expenses, $60,000 for country club expenses, $52,000 for personal travel, and $213,000 for personal real estate. The United States also offered proof that Threadgill had evaded the payment of his taxes through disguising the personal nature of his assets and by placing real estate in the names of nominee trusts.
This investigation was conducted by IRS-Criminal Investigation. Assistant U.S. Attorney Frank M. Dale, Jr. represented the United States.