Santa Rosa Doctors Indicted For Tax Fraud
SAN FRANCISCO - A federal grand jury returned a superseding indictment against Robert Rowen and Teresa Su, charging them with conspiracy to defraud the United States, announced United States Attorney David L. Anderson and Internal Revenue Service (IRS) Special Agent in Charge Kareem Carter. In addition, each defendant also was charged with a separate count of tax evasion.
According to the indictment, Rowen and Su, ages 69 and 66, respectively, of Sebastopol, Calif., are a married couple who practiced medicine from their clinic in Santa Rosa. The medical doctors allegedly conspired to evade payment of Rowen’s federal income tax liabilities by concealing Rowen’s ability to pay his 1992 through 1997 and 2003 through 2008 federal income tax liabilities. Specifically, Rowen and Su allegedly placed his assets out of the reach of the United States Government, placed assets in the names of other persons or entities, deposited Rowen’s revenue into nominee bank accounts, used cash to conduct personal and professional business, converted his revenue into gold and silver coins, and provided false information to the IRS.
The indictment provides a description of various methods the couple allegedly used to conceal Rowen’s income. For example, the indictment describes how the couple instructed patients to make their checks for medical services payable to gold dealers who, in turn, purchased gold and silver coins. In addition, the indictment alleges Rowen formed a company named Lotus Management LLC to receive revenue from a different company. Rowen then deposited the funds into a bank account opened in the name of Lotus Management LLC, and used the proceeds to purchase gold and silver coins. Further, the couple allegedly used cash to pay the rent for the medical practice as well as to pay the balance on credit cards used to cover various business and personal expenses.
In sum, the indictment alleges that between January 3, 2007, and April 11, 2014, Rowen, both individually and through nominees, converted over $3,900,000 of his revenue to gold and silver coins. Count one of the superseding indictment charges Rowen and Su with conspiracy to defraud the United States, in violation of 18 U.S.C. § 371, and counts two and three of the superseding indictment charges the defendants each with one count of tax evasion, in violation of 26 U.S.C. § 7201.
A superseding indictment merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted of the conspiracy count, the defendants face a maximum sentence of five years imprisonment, and a fine of $250,000, plus restitution. If convicted of tax evasion, the defendant faces a maximum sentence of three years in prison and a $250,000 fine. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Rowen and Su made a federal court appearance on the superseding indictment on February 26, 2020. The defendants currently are released on a $200,000 bond. The matter was assigned to the Honorable Charles R. Breyer, U.S. District Judge who scheduled the trial in the case to begin on February 22, 2021.
Assistant U.S. Attorney Cynthia Stier is prosecuting the case. The prosecution is the result of an investigation by the IRS.