Western District of Washington

February 20, 2007

Financial Guru failed to Report Millions in Income and Falsified Documents to Derail Governments Investigation

WADE B. COOK, 57, of Fall City, Washington was convicted today in U.S. District Court in Seattle of Tax Evasion, Filing False and Fraudulent Tax Returns and Obstruction of Justice. The jury deliberated for four days after a nineteen day trial in front of U.S. District Judge Thomas S. Zilly. Judge Zilly allowed WADE to remain free on a personal appearance bond pending sentencing on June 22, 2007. The jury failed to reach a verdict with respect to Laura M. Cook, who was also charged in the indictment.

WADE COOK organized and lectured at hundreds of seminars on a wide range of financial and asset protection topics. COOK authored many books including Wall Street Money Machine, Wealth 101, Brilliant Deductions, and Business by the Bible. Over three years in the late 1990's COOK made $9.5 million in royalties from his books and lectures. But, as Assistant United States Attorney Robert Westinghouse showed in court, “not one dime was reported. Never on any tax return.”

Testimony at trial revealed that in 1998, 1999 and 2000, WADE COOK reported adjusted gross incomes of approximately $350,000. The government presented evidence that they did not report, and willfully concealed, receipt of approximately $9.5 million in royalties from WADE COOK’s many books and seminars despite using such funds for his personal benefit. By not disclosing those royalties on his tax returns, he received and utilized those monies tax free. As part of the tax fraud, WADE COOK created a fictitious limited partnership called Never Ending Wealth, LP (NEW), which was in turn ostensibly owned by a type of tax exempt entity called a charitable remainder trust. Purportedly, the trust was for the benefit of the Mormon Church. In truth, the trust was simply a vehicle for WADE COOK to fraudulently conceal his royalty income and spend it as he wished. No funds were left in the trust for the church.

In fact, WADE COOK used money in the trust for new cars, jewelry, and exotic Arabian horses for their ranch. He took money out to invest in various failed businesses, and spent $200,000 on a suite at Key Arena in Seattle. “What does (the trust) have to do with the Mormon Church? Nothing. What does it have to do with greed? Everything,” Westinghouse told the jury. “The Cooks could not live without the trappings of wealth.”

The jury also convicted WADE COOK of Obstruction of Justice in connection with efforts to recharacterize use of the royalty funds, after the fact, as loans. In 2005, in a meeting with government prosecutors, a promissory note was produced dated March 1999, in an effort to show that the raiding of the trust account had been loans all along. Using computer forensics the government showed the note had actually been typed by Laura M. Cook in 2003. “Looking down the barrel of criminal prosecution... out of thin air comes this promissory note,” Westinghouse said.

This case was investigated by the Criminal Investigation Division of the Internal Revenue Service. The case was prosecuted by Assistant United States Attorneys Robert Westinghouse and Kurt Hermanns. For further information, they can be reached at (206) 553-7970, or (253) 428-3800.

For assistance, contact Emily Langlie, the Public Affairs Officer for the United States Attorney’s Office, Western District of Washington, at (206) 553-4110.