Trust a scammer, spend 21 months in prison

[Demosthenes]

Man sentenced on income tax evasion charges

Federal authorities announced Friday that John Schreiber, 65, of Prospect, NY, was sentenced in Federal Court in Utica. District Judge Hurd imposed a sentence of 21 months incarceration, three years supervised release and a fine of $4,000. Schreiber had been found guilty of five counts of tax evasion for the years 1999 - 2003 by a jury in December 2006.

Schreiber, a former prison guard at Midstate Correctional Facility was found guilty of evading over $40,000 in Federal Income Taxes for the years 1999 through 2003.

The evidence at trial showed that Schreiber failed to file personal tax returns or to pay the taxes he owed in any of those years. Rather, Schreiber filed "Trust" returns each year that listed his personal income as having been paid to a "Trust", and further deducted all the income as "trustee's fees," payable to himself, which were not then reported as income on a corresponding individual income tax return.

Schreiber testified at his trial that he had learned about using "Trust" returns from an internet site. He further testified that he had ignored the advice of the personnel office at Midstate, as well as advice from Internal Revenue Service employees, all of whom told him that he should ignore the internet "scam" site and that he should pay taxes on his income.