FOR IMMEDIATE RELEASE:

June 17, 2002

Kesha Handy                           
P. O. Box 61129                      
Houston, TX 77208                  
Phone: 713/567-9335  
Fax: 713/718-3390
E-Mail: usatty.txs@usdoj.gov

MAN PLEADS GUILTY TO TAX FRAUD
John R. Lewis, Assistant U.S. Attorney
Phone: 713/567-9732

(HOUSTON) U. S. Attorney Michael T. Shelby announced today that Howard Abbas Banks pleaded guilty today to willfully attempting to evade and defeat individual income tax for the year 1996 in violation of Title 26, United States Code, Section 7201.

During today's court proceedings, U. S. District Judge Ewing Werlein Jr., asked the prosecutor to describe the facts the government was prepared to prove if the case had gone to trial. The prosecutor stated the following facts which Banks then admitted were true.

Banks was employed as the finance and insurance manager at Star Motor Cars from 1991 until he was fired in October 1996. Banks had wide authority to make deals to finance a customer's purchase of a car from Star Motor Cars, and to request and obtain checks from Star Motor Cars.

During 1996, Banks prepared fraudulent records that made it appear that Star Motors owed thousands of dollars to various customers in connection with the customers' purchase of cars. Banks requested that Star Motors issue checks to each customer. Star Motors issued checks payable to the customers. The checks from Star Motors were drawn on an account that Star Motors maintained at Sterling Bank.

Banks converted the Star Motors checks into cashiers checks. The cashiers checks, issued by Sterling Bank, were also payable to the customers of Star Motors. Banks deposited each cashiers checks into a personal account that he maintained at Southwest Bank of Texas. Each cashiers check was endorsed with a signature that appeared to be that of the Star Motors customer. However, the signatures were forged.

During 1996, the cashiers checks that Banks deposited into his personal bank account totaled over $116,000. This $116,000 was taxable income. Upon such taxable income there was due and owing from Banks federal income tax in the approximate amount of $36,000.

On or about September 11, 1997, in the Southern District of Texas, Banks signed and filed a false and fraudulent 1996 joint individual federal income tax return (Form 1040) which omitted approximately $116,000 of taxable income, and failed to pay to the Internal Revenue Service approximately $36,000 of additional federal income tax was due and owing on the $116,000. In so doing, Banks willfully attempted to evade and defeat income tax which was owing to the United States for the year 1996.

At the time he filed the false and fraudulent return, Banks knew that the return omitted a substantial amount of taxable income and taxes due and owing.

Banks will be sentenced on September 20, 2002, by U. S. District Judge Ewing Werlein, Jr. He faces a maximum term of imprisonment for five years, a fine of not more than $250,000, and a term of supervised release not to exceed three years.

The matter was investigated by the Internal Revenue Service – Criminal Investigations, and is being prosecuted by Assistant United States Attorney John Lewis.

020614-banks