Husband And Wife Sentenced For 10-Year Long Tax Defiance Scheme
Defendants Claimed Not To Be U.S. Citizens and To Be Exempt from Paying Taxes,
Then Falsely Sought Refunds of Over $420,000
ATLANTA – Stephen Paul Thomas, 46, and Patricia Denese Anderson, 51, of Lawrenceville, Georgia, who waged a 10-year tax defiance scheme against the IRS, were sentenced today by United States District Judge Charles A. Pannell. Thomas was sentenced to serve 5 years in federal prison and Anderson was sentenced to 4 years, 3 months in federal prison. On October 16, 2012, after a six-day trial, Thomas and Anderson were convicted by a jury of conspiring to defraud the United States and making false claims upon the Internal Revenue Service.
“For over a decade, Thomas and Anderson waged a campaign of obstruction against the IRS, culminating in filing false tax returns claiming hundreds of thousands of dollars in false refunds,” said United States Attorney Sally Quillian Yates. “They cheated not only the government, but their fellow taxpayers. The sentence in this case demonstrates that those who defy the tax laws by obstructing the IRS and filing false and frivolous tax returns will be prosecuted and punished for their conduct.”
“The term voluntary compliance means that each of us are responsible for filing a tax return when required and for paying the correct amount of tax,” stated Acting Special Agent in Charge, IRS Criminal Investigation, Veronica Hyman-Pillot. “That responsibility should not be taken lightly. The defendants chose to take extreme measures in order not to file and pay taxes and they are now convicted felons with a prison term to serve.”
Thomas was sentenced to 5 years in prison, to be followed by 3 years of supervised release, and fined $10,000. Anderson was sentenced to 4 years, 3 months in prison, to be followed by 3 years of supervised release, and fined $10,000.
According to United States Attorney Yates, the charges and other information presented in court: Thomas and Anderson, who were married and jointly owned and operated an outdoor yard furnishing store and general contracting business in Duluth, Georgia, stopped filing federal income tax returns in the 1990s. They then hired American Rights Litigators (ARL), an organization that sold and promoted tax defiance schemes, to send obstructive and harassing materials to the IRS on their behalf. The IRS repeatedly sent notices to Thomas and Anderson notifying them that they had to pay their federal income taxes and that they had to comply with the tax laws.
After the IRS shut down ARL as a result of fraudulent anti-tax actions, Thomas and Anderson continued to send a variety of obstructive, frivolous and harassing documents to IRS and Department of Treasury officials instead of paying their taxes. These documents included statements that they were not United States citizens but instead were “American citizens”; that they were not subject to the federal income tax laws; and that paying income tax was voluntary. Thomas and Anderson also established business bank accounts using fictitious tax identification numbers for the purpose of hiding the money inside the accounts from the IRS. They also instructed a financial institution as well as a bartering exchange company that their business operated solely in Belize, knowing that their business was located and did business throughout the state of Georgia.
Finally, in 2009 after a decade of not filing tax returns, Thomas and Anderson submitted two false tax returns claiming over $420,000 in fraudulent refunds from the IRS. That same year, Thomas and Anderson also submitted fictitious financial instruments to the federal government, including a document purporting to be a $100 billion private registered bond, and instructed the government to use this bogus bond to pay any of their debts to the government.
This case was investigated by the Internal Revenue Service Criminal Investigation.
Assistant United States Attorneys Thomas J. Krepp and Sally B. Molloy prosecuted the case.
For further information please contact the U.S. Attorney’s Public Information Office at USAGAN.PressEmails@usdoj.gov or (404) 581-6016. The Internet address for the HomePage for the U.S. Attorney's Office for the Northern District of Georgia is www.justice.gov/usao/gan.