I.R.S. Accuses Man of Hiding $450 Million

[Tyler Durden]

>But later, questioned by reporters, Mr. Everson noted that the I.R.S. law
>enforcement staff has been cut by at least a quarter in recent years. Mr.
>Wainstein, the United States attorney, said one of his prosecutors had
>spent a year developing the case.

Anyone gigling? Notice that the amount he cheated the government out of 
could have easily payed the salaries of a bunch more IRS agents.

This guy should receive an Official Cypherpunk award. Or does he not deserve 
one 'cause he got caught?

-TD


>From: "R.A. Hettinga" <rah at shipwright.com>
>To: cypherpunks at al-qaeda.net
>Subject: I.R.S. Accuses Man of Hiding $450 Million
>Date: Tue, 1 Mar 2005 13:00:43 -0500
>
><http://www.nytimes.com/2005/03/01/business/01tax.html?th=&pagewanted=print&position=>
>
>The New York Times
>March 1, 2005
>
>I.R.S. Accuses Man of Hiding $450 Million
>  By DAVID CAY JOHNSTON
>
>
>ASHINGTON, Feb. 28 - A prominent telecommunications entrepreneur who once
>tried to mount a rescue of a Russian space station has been arrested and
>charged with evading taxes by hiding at least $450 million of income
>through offshore corporations.
>
>According to a 12-count indictment released on Monday that federal
>prosecutors called the largest criminal case of individual tax evasion, the
>entrepreneur, Walter Anderson, 51, did not pay over $210 million in federal
>and local income taxes he owed for the years 1995 through 1999 alone.
>
>"Mr. Anderson ran the table when it came to violating the tax laws," Mark
>W. Everson, the Internal Revenue Service commissioner, told a news
>conference Monday. "Because of his dishonest dealings, Mr. Anderson's
>lavish lifestyle was subsidized by honest, hard-working Americans."
>
>In 1998 Mr. Anderson, who lives in Washington, reported a total income of
>$67,939 and paid a tax of just $494. Mr. Everson said Mr. Anderson actually
>made at least $126 million that year that he never reported. From 1987
>through 1993, officials said, Mr. Anderson failed to file a tax return.
>
>Mr. Anderson is the chief executive of Orbital Recovery, a company trying
>to extend the life of telecommunications satellites. He was arrested
>Saturday at Dulles Airport outside Washington as he stepped off a plane
>from London, according to Kenneth L. Wainstein, the United States attorney
>for the District of Columbia.
>
>In court on Monday, Mr. Anderson pleaded not guilty to the charges. His
>lawyer, John Moustakas, told Magistrate Judge Alan Kay that the
>government's case was based on "innuendo and rumor."
>
>  If convicted, Mr. Anderson faces as much as 24 years in prison.
>
>Judge Kay ordered Mr. Anderson held without bail until a bond hearing on
>Thursday. Susan Menzer, a prosecutor in the case, called Mr. Anderson "a
>flight risk" who "can't be trusted."
>
>"He hasn't been listening to judges for years," she added.
>
>  Since a search warrant was executed in 2002, Mr. Anderson has moved
>artwork and cash to Switzerland to defeat both tax collectors and creditors
>who have civil court orders, the Justice Department said in court papers.
>
>Mr. Moustakas did not return a phone call seeking comment.
>
>Mr. Anderson has long attracted a certain level of public attention,
>especially when he tried to arrange a rescue of the Mir space station five
>years ago. He frequently flew in a private jet and made deals involving
>millions of dollars. At conferences on space travel he often spoke of his
>hatred of government.
>
>But he came under scrutiny, law enforcement officials suggested, only
>because of a tip from a disgruntled business associate.
>
>  Mr. Anderson, according to the indictment, formed an offshore 
>corporation,
>Gold and Appeal Transfer, in the British Virgin Islands in 1992 to hide his
>profits from deals involving a telecommunications company he started in the
>1980's.
>
>Over the next three years, the indictment charged, Mr. Anderson set up a
>network of offshore corporations, including one in Panama under the alias
>Mark Roth, that were used to hide his ownership of three telecommunications
>companies and allow him to earn hundreds of millions of dollars without
>paying taxes.
>
>  While Mr. Anderson at times insisted publicly that he was worth no more
>than $4 million, he serves as a senior business adviser to Constellation
>Services International, a fledgling satellite rescue company that disclosed
>his ownership of several companies, including Gold and Appeal. Its Web site
>said Gold and Appeal was worth at least $100 million and described Mr.
>Anderson as selling the Esprit Telecom Group in 1998 for $900 million.
>
>  In extensive filings with the I.R.S. and the Securities and Exchange
>Commission, the indictment charged, Mr. Anderson claimed that he was merely
>an employee of Gold and Appeal, the offshore bank that the indictment says
>was central to his tax-evasion effort.
>
>  "The I.R.S. holds all Americans, even the very wealthy, to the same
>standard," Mr. Everson said. "This indictment sends a strong signal that we
>will not tolerate abuse of the tax laws."
>
>But later, questioned by reporters, Mr. Everson noted that the I.R.S. law
>enforcement staff has been cut by at least a quarter in recent years. Mr.
>Wainstein, the United States attorney, said one of his prosecutors had
>spent a year developing the case.
>
>Prosecutors noted that it was difficult to catch determined tax cheats but
>said that some countries known as tax havens had been cooperating with
>American investigators more often since the 9/11 terrorist attacks. The
>government has stepped up investigations but managed to recommend only
>1,400 tax prosecutions out of the 130 million tax returns filed annually.
>
>For budgetary reasons, the I.R.S. relies almost entirely on data reported
>to it on computer files, not on traditional detective work, to help
>identify tax evaders.
>
>  Gary Hudson of Redwood City, Calif., said that Mr. Anderson invested $30
>million in his Rotary Rocket, the primary backing for a private rocket
>launching and recovery firm that ultimately failed.
>
>"One condition of his investment was that we could not take any government
>money," Mr. Hudson said in a telephone interview on Monday.
>
>Besides avoiding federal taxes, the indictment charges, Mr. Anderson also
>evaded at least $40 million in income taxes owed the District of Columbia
>and $254,000 in local sales taxes he should have paid on jewelry, wine and
>art, including a painting by Salvador Dalm and several by Reni Magritte.
>
>Copyright 2
>--
>-----------------
>R. A. Hettinga <mailto: rah at ibuc.com>
>The Internet Bearer Underwriting Corporation <http://www.ibuc.com/>
>44 Farquhar Street, Boston, MA 02131 USA
>"... however it may deserve respect for its usefulness and antiquity,
>[predicting the end of the world] has not been found agreeable to
>experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'
>--
>-----------------
>R. A. Hettinga <mailto: rah at ibuc.com>
>The Internet Bearer Underwriting Corporation <http://www.ibuc.com/>
>44 Farquhar Street, Boston, MA 02131 USA
>"... however it may deserve respect for its usefulness and antiquity,
>[predicting the end of the world] has not been found agreeable to
>experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'