December 2012 Archives

U.S. Immigration and Customs Enforcement Issues New Memo on ICE Detainers

December 27, 2012, by The McKellar Law Firm, PLLC

On December 21, 2012, Director of U.S. Immigration and Customs Enforcement (ICE) John Morton issued a memorandum to provide additional guidance on the use of ICE detainers. I have previously written about ICE detainers here. This memorandum re-emphasizes ICE's focus on removing those individuals whose "removal promotes public safety, national security, border security, and the integrity of the immigration system." A copy of the memorandum can be found here.

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The memorandum promises that ICE will be revising its current detainer form (Form I-247) in an effort to ensure compliance with removing persons who are in the United States without authorization AND who meet one or more of the following 8 conditions:

  1. Prior felony conviction
  2. 3 or more prior misdemeanor convictions
  3. A prior misdemeanor conviction or has simply been charged with a misdemeanor offense if the charge involves any of the following:
  4. * Violence, threats, or assault * Sexual abuse or exploitation * DUI or controlled substance * Fleeing the scene of an accident * Unlawful possession of firearm or other deadly weapon * Distribution of controlled substances * "Other significant threat to public safety"
  5. Prior conviction for illegal entry per 8 USC ยง 1325
  6. Illegal re-entry after a previous removal or return
  7. Pending or current order of removal
  8. Committed immigration fraud
  9. Poses a significant risk to national or border security or to public safety

While there are many ambiguous and troubling terms used in the 8 conditions above, it is nice to see ICE continue its focus on dedicating its resources to pursuing the so-called "bad immigrants," as opposed to those persons who do not have the 8 referenced conditions.

Stephen Baldwin and Owner of YouPorn Facing Tax Evasion Charges

December 11, 2012, by The McKellar Law Firm, PLLC

As a criminal defense and tax attorney, I often deal with the intersection of those two areas of practice when handling tax evasion and tax fraud cases. Even though the number of tax prosecutions by the federal government has increased in recent years, the total number of criminal tax prosecutions are relatively few. For example, in 2010, there were approximately 1,250 tax fraud charges brought by the Department of Justice.

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With so few tax prosecutions each year, the types of criminal tax prosecutions usually focus on a few groups of people: celebrities or high profile people, tax protesters, and lately, those who have attempted to evade taxes by hiding assets outside the country. Of course, there are cases which don't fit into of the aforementioned categories, but two recent tax fraud cases show how tax authorities have targeted a few higher profile individuals. While the IRS and the Department of Justice are usually the lead agencies in the pursuit of tax fraud prosecutions, other agencies can also get involved.

Last week, actor Stephen Baldwin (who is looking very "Baldwin-esque" in the mugshot above) was arrested in New York for failure to file state income taxes for $350,000 in earnings from 2008-2010. Baldwin denies that he committed any crime, but acknowledges that his personal bankruptcy and other financial factors contributed to his inability to pay his taxes. Baldwin is scheduled to return to court on February 5, 2013.

Apparently, the U.S. is not the only government which pursues higher profile individuals, as Germany arrested Fabian Thylmann last week on suspicion of tax evasion. Although Thylmann may not be a household name to many, he is the owner of 2 of the world's top 110 websites, YouPorn and Pornhub. Thylmann was arrested in Belgium and will likely be extradited to Germany in the near future.

Nashville Tax Return Preparers Face Mo' Problems

December 7, 2012, by The McKellar Law Firm, PLLC

As I have written about previously, tax return preparers can face both civil and criminal penalties for preparing false or fraudulent tax returns. One such tax return preparer company, Mo' Money Taxes, is now dealing with a civil injunction lawsuit, which was filed earlier this week against them in Nashville by the U.S. Attorney's Office in Middle Tennessee, according to published reports.

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The Justice Department's lawsuit claims that defendants Toney Fields and Trumekia Shaw did "intentionally prepare and file fraudulent federal income tax returns to obtain improper tax refunds for customers." Claimed tax losses by the Government could exceed $5 million in tax year 2011. Some of the alleged errors committed by employees of Mo' Money Taxes include: using taxpayers' end-of-the-year pay stubs (instead of W-2 forms) to assist in preparing tax returns; manufacturing fake W-2 forms; and claiming false tax credits for child tax credits, incorrect number of dependents, and false charitable donations.

This civil injunction in Nashville is the latest legal battle against Mo' Money Taxes, and follows the arrest of franchise owner Jimi Clark and four Mo' Money employees in October, 2012, for conspiracy to commit tax fraud by falsely claiming educational tax credits on 47 returns filed in 2009. Additionally, the Memphis-based company has hundreds of people claiming that they never received their tax refund checks.

New Jersey Couple Sentenced to 44 Months Imprisonment for Failure to Pay Employment Taxes

December 6, 2012, by The McKellar Law Firm, PLLC

As a Tennessee tax attorney, I often represent small business owners who are delinquent in paying their payroll taxes, which are commonly referred to as an owner's "941 taxes." While the majority of these types of clients are seeking to resolve their tax debts with the Internal Revenue Service by civil means, a few of these cases are criminal in nature. Simply put, the Government views failure to pay provide payment for payroll taxes as theft, as the employer has taken money from an employee's check and failed to pay the withheld amounts to the IRS.

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According to a press release from the Department of Justice, James and Theresa DeMuro of New Jersey each received 44-month prison sentences for conspiracy to defraud the Government and twenty-one counts of failing to pay payroll/employment taxes. The couple was also ordered to pay restitution of $1,337,952.12 to the IRS.

The couple's sentence came after a jury trial, where evidence was introduced that the couple withheld over a half-million dollars from their employees, but failed to pay any of this money to the IRS. The convicted couple also withheld money from employees' checks for health insurance, retirement accounts, and child support, but they also failed to provide these funds to the appropriate agencies or accounts. Instead, evidence was introduced showing that the DeMuros spent nearly $300,000 for purchases from Home Shopping Network, QVC, and Jewelry Television.