Pure trust prosecutions just keep plodding on

[Demosthenes]

Family accused of tax evasion
By BRENDAN WEST
Evening Sun Reporter
Evening Sun
Article Launched:05/26/2007 06:59:01 AM EDT

Members of a Hanover family have allegedly defrauded the Internal Revenue Service since 1994 by using several fake trusts and offshore bank accounts.

The Harrisburg U.S. Attorney's office indicted Avery L. Sollenberger, 77; Dena Sollenberger, 80; and Wendell Sollenberger, 42, all of 309 Primrose Lane; Gary Sollenberger, 52, of 15 Villa Vista Ave.; and Luanne Hunsinger, 49, of 5 Christians Drive, on tax-evasion charges.

The indictment was unsealed Friday afternoon after IRS agents arrested Gary and Wendell Sollenberger, Avery and Dena Sollenberger's sons, on conspiracy charges, according the U.S. Attorney's office. Authorities also allege Gary and Wendell Sollenberger have not filed personal income-tax returns since 1995.

The Sollenbergers allegedly used several "sham trusts" to siphon income from their house-framing business, known as Associated Dynamics, and real-estate business, Bitterroot Rental Co., according to court documents.

The family also allegedly transferred money from domestic bank accounts to a bank in Cyprus and then used ATMs or wired money back to the United States when needed, according to court documents.

Authorities allege the Sollenbergers failed to report about $4.7 million from their framing business between 1996 and 2004 and almost $126,000 from their real-estate business between June 2001 and December 2004.

The family "concealed (its) assets É from the IRS by placing, in name only, (its) assets in bogus trusts," according to the indictment. The scheme was designed to "impair, impede, obstruct and defeat computation, assessment and collection of their federal income taxes."

The framing business allegedly failed to file tax returns for 1996 to 1998 and 2000 to 2005, and the Sollenbergers allegedly did not pay federal taxes on incomes received in those years, according to the indictment.

The real-estate business also did not file tax returns or pay federal income taxes on its income, according to the indictment.

The defendants each face conspiracy charges for failing to report taxes from 2000 to 2004.


Sham trusts

According to the indictment, in 1994 the Sollenbergers became clients of a trust company which "markets, sells and services schemes to defraud the IRS."

From then on, the family allegedly transferred ownership of its framing business to several sham trusts it purchased from the trust company, each time changing the business' name. They also allegedly transferred income, tools, equipment, houses and vehicles into the fake trusts.

In 1994, Sollenberger Homes became Design Concepts, which changed to Alanmore Enterprises in 1997 before becoming Contract Building Co. in 2001. In 2004 the Sollenbergers allegedly changed the name of the business to Associated Dynamics LLC.

Every time the businesses' names changed, it appeared the family was no longer in control of the assets and therefore was not responsible for filing taxes on them, according to the indictment.

Each of the Sollenbergers' homes was listed under a different sham trust. Gary Sollenberger allegedly transferred ownership of his Villa Vista Avenue home to Ledger Management Co. According to the indictment, Gary Sollenberger is Ledger's managing director and caretaker and therefore still owns the house.

Wendell Sollenberger allegedly transferred ownership of personal property to Zodiac Management, another sham trust, but still controls the property, according to the indictment.

Avery and Dena Sollenberger's home is technically owned by Telec Enterprises, although the U.S. Attorney's office alleges the couple maintains complete control over the house.

As Bitterroot Rental Co., the family filed a deed in May 2001 with the Adams County Register and Recorder's office for properties in the 300 block of Main Street in McSherrystown. Bitterroot Rental Co. then sold the properties for more than $170,000.

As Associated Dynamics, the Sollenberger's business bought in December 2004 and May 2005 several Ram Drive, Hanover, properties, later reselling them for about $90,000 profit.

Other companies the Sollenbergers allegedly used as sham trusts include Ideal Way LLC and Sunny Isles Fiduciary Fund.


Family ties

While the indictment does not say whether Luanne Hunsinger – Avery and Dena Sollenberger's daughter – transferred personal property into sham trusts, Hunsinger allegedly served as a secretary or agent for several of the sham trusts.

Hunsinger is also accused of signed checks on behalf of the family's real-estate business.

Authorities allege the Sollenbergers designated themselves and Hunsinger as "beneficial owners" of Ramada Group Limited, the international sham trust the family allegedly used to siphon funds to the Cypriot bank. Ramada Group Limited is incorporated through the British Virgin Islands.

Avery and Dena Sollenberger and Luanne Hunsinger did not immediately respond to telephone messages left for them Friday.

The Assistant U.S. Attorney assigned to the case, Joseph Terz, also did not immediately respond to a telephone message.