Robert J. Fedor, Esq., L.L.C.

Former mayor and wife prevail in federal IRS case

In cases where an individual or small business owner is facing felony charges related to tax evasion or tax fraud, the burden of proving intentional wrongdoing falls to the prosecution. However, even in cases where evidence proves an individual is guilty of committing tax evasion or tax fraud, prosecutors must be able to prove these crimes were committed with knowledge and intent.

The former mayor of one U.S. city and his wife were recently seen smiling as they left a federal courthouse. The couple had been the target of a federal case involving allegations of tax evasion and fraud. While prosecutors were able to present evidence to prove the couple was guilty of filing inaccurate tax returns, the jury in the case determined that neither spouse did so with intent.

At the center of the prosecution’s case were claims the couple hid assets totaling hundreds of thousands of dollars by providing friends and business associates with high-interest loans. Prosecutors claimed money earned from the high-interest loans was then funneled through three so-called shell companies were it was then used to fund the couple's lavish lifestyle and political endeavors.

In their defense, the couple maintained they were victims of an incompetent accountant. Additionally, the couple also claimed to be amongst those individuals who were taken advantage of by a man who subsequently was convicted of felony crimes related to a $40 million ponzi scheme.

The couple was elated when jury members returned a not guilty verdict, exclaiming that truth and justice prevailed. This case proves the critical role a criminal defense attorney plays when the IRS decides to pursue a federal tax crimes case. Even in cases where an individual committed tax fraud or tax evasion, a defense attorney can help a judge or jury realize that such crimes stemmed from honest mistakes and not an intentional disregard of IRS tax laws.

Source: CBS Miami, "Jury Finds Ex-Hialeah Mayor & Wife Not Guilty Of Tax Evasion," Peter D'Oench, April 29, 2014

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