Old friends (?) finally meet their doom

[Judge Roy Bean]

From the archives comes a pair for sentencing:

viewtopic.php?f=27&t=4053&p=62699

http://www.currentargus.com/ci_18083419

Prison sentences handed down to local couple
Mark, Sharon Hopkins to also pay $1.74 million in restitution
Posted: 05/17/2011 09:08:34 PM MDT

CARLSBAD — The Carlsbad couple convicted of tax evasion and conspiracy were sentenced Tuesday afternoon to 10-year and 8-year sentences, and were ordered to pay $1.7 million to the Internal Revenue Service. ...
According to information from the U.S. Department of Justice, the couple were convicted by a federal jury in Albuquerque of seven counts of tax evasion and one count of conspiracy on Sept. 29, 2009.

Over a year and a half since conviction?

[Gregg]

dey waz busy

[LPC]

According to information from the U.S. Department of Justice, the couple were convicted by a federal jury in Albuquerque of seven counts of tax evasion and one count of conspiracy on Sept. 29, 2009.

Over a year and a half since conviction?

It's a typo. The jury verdict was entered on 9/29/2010.

The case involved a bunch of old friends:

1. Sharon Hopkins was represented by Jonathan Alter, and then Tommy Cryer at trial.

2. Mark Hopkins was represented by Larry Becraft.

3. The defendants attempted to present Joseph Banister as an expert witness. (The US objected, and the judge agreed, because his proffered testimony was not shown to be relevant to any factual issue in the case.)

4. The defendants filed at least one "zero return," apparently following Irwin Schiff's lead. (There are references in the motions to "seminars" and "tax protester literature" relied upon by the defendants, but I didn't spend the time to track them all down.)

Department of Justice press release:

NEW MEXICO PHYSICIAN AND WIFE SENTENCED ON
FEDERAL TAX EVASION CONVICTIONS

WEDNESDAY, MAY 18, 2011

ALBUQUERQUE, N.M. -- An emergency room doctor and his wife were sentenced yesterday for tax evasion, announced Deputy Assistant Attorney General for Criminal Matters for the Justice Department's Tax Division Ronald A. Cimino and U.S. Attorney for the District of New Mexico Kenneth J. Gonzales. Dr. Mark E. Hopkins, 60, was sentenced to 120 months in prison to be followed by three years of supervised release, and Sharon June Hopkins, 60, was sentenced to 97 months in prison to be followed by three years of supervised release.

The Hopkins' jointly were ordered to pay $1,744.222.26 in restitution to the Internal Revenue Service (IRS). Upon their release, the couple will be required to make $2,000 monthly payments to the IRS and to cooperate with the IRS in paying their taxes, past and present. Finally, the Hopkins' were ordered to pay $965.84 for the cost of a video deposition taken during the course of the prosecution.

On Sept. 29, 2010, a federal jury sitting in Albuquerque, N.M., convicted the Hopkins' of seven counts of tax evasion and one count of conspiracy. At the time, Mark Hopkins was an emergency room doctor at the Carlsbad Medical Center, and Sharon Hopkins was the owner of My Favorite New Mexico Foods LLC, a business that manufactured and sold traditional New Mexico foods throughout the United States. Before moving to Carlsbad in 2001, the couple resided in Roswell, N.M.

According to the allegations in the indictment and the evidence presented at trial, the Hopkins' had not filed accurate personal tax returns since tax year 1997. They filed a "zero" tax return for tax year 1996, which reported no wages and requested a refund of all withholding. From Jan. 1, 1996, through Dec. 31, 2007, Dr. Hopkins earned more than $3 million in income from his work as an emergency room doctor and paid only $21.25 in federal income taxes on this income. At sentencing, the court determined the tax loss to be $2,171,018.57 for 1996 to 2007. The Hopkins' also failed to file or pay state income tax to the New Mexico Department of Taxation and Revenue during this time period.

At trial, the Hopkins' claimed that Dr. Hopkins' income from his employer was not taxable because it was simply an "exchange" of labor for time. The evidence at trial showed that the couple used a number of "tax defier" schemes such as directing Dr. Hopkins' income to a purported religious entity, named Shalom Enterprises. However, the Hopkins' paid a number of personal expenses such as their mortgage, credit cards and a timeshare in Mexico, out of the Shalom Enterprises bank account. The couple also titled bank accounts and their home in the names of "pure trusts."

As shown at trial, Dr. Hopkins previously was pictured on the front page of the April 16, 2007, Carlsbad Current Argus, standing outside the post office the previous day protesting the payment of federal income taxes. "Sentences like the one returned today, send a loud and clear message that those who use illegal tax schemes will be fully punished for their actions," said Deputy Assistant Attorney General for Criminal Matters Cimino.

"No matter how much Dr. and Mrs. Hopkins disagreed with our tax system, they were still required to obey the law," said U.S. Attorney Gonzales. "The sentences imposed on the Hopkins are appropriate given the type of manipulation and deception in which these two educated and skilled professionals engaged to evade paying taxes."

Dawn Mertz, Special Agent in Charge of the IRS-Criminal Investigation Division, stated, "The severity of the sentences imposed on Mark and Sharon Hopkins should send a clear message to those who are undertaking elaborate steps to avoid paying their income taxes. Mark and Sharon Hopkins are both successful individuals and earned more than $3 million in income and have paid nothing in federal income taxes. Honest citizens should not foot the bill for people like the Hopkins."

Assistant U.S. Attorney Paul H. Spiers and U.S. Department of Justice, Tax Division, Trial Attorney Jed M. Silversmith prosecuted the case, which was investigated by the Phoenix Field Office of the IRS-Criminal Investigation Division.

[Judge Roy Bean]

I guess as long as high income/high net-worth individuals are willing to play fast and loose with the tax laws, Cryer and Becraft will keep plugging away.

[Pottapaug1938]

I guess as long as high income/high net-worth individuals are willing to play fast and loose with the tax laws, Cryer and Becraft will keep plugging away.

Can you say the words "cash cow", boys and girls?

[Kestrel]

I guess as long as high income/high net-worth individuals are willing to play fast and loose with the tax laws, Cryer and Becraft will keep plugging away.

I had the (mis)fortune of meeting Cryer some years ago. He had convinced a mutual friend that his deluded tax-denier ideas were true, and they both were going to some length to convince me. I let them pay for lunch but told them they were both nuts. Even if I would hypothetically consider conceding that his ideas had some merit, I will not play "You Bet Your Life's Savings" against the IRS to further Cryer's cause. The civil actions against him since then have proven me right.

What I'm wondering now is why Cryer still hasn't been shut down. He is still representing clients in court on tax matters. Yet through his personal actions in civil court, and in ignoring Federal District Court orders to turn over business records for recent tax years, Cryer is openly thumbing his nose at the IRS and the Federal Courts. If he's been jailed for contempt on his failure to turn over his business records, I haven't heard about it.

I ran across this article recently:
Texas Tax Attorney Disbarred from Practicing before IRS
http://www.accountingtoday.com/news/Tex ... 296-1.html

Washington, D.C. (May 6, 2011)

The Internal Revenue Service’s Office of Professional Responsibility has prevailed in a Texas attorney’s appeal of an order for disbarment to practice before the IRS for willfully failing to file his federal tax returns.

The IRS alleged that Texas attorney Donald Petrillo willfully failed to file his federal individual income tax returns for 2001 through 2006 on a timely basis and to file his 2007 tax return. The untimely filings were from two to four years late. The Office of Professional Responsibility further alleged that Petrillo willfully failed to pay the outstanding tax balances due on the late returns he did file.

Petrillo did not deny the allegations in the complaint that he failed to properly file his returns and pay his income tax when he filed an answer to the complaint in July 2010. However, he asserted that the failure to timely file and pay “was not the result of willful conduct; but rather due to medical, factual and financial circumstances beyond the control of respondent.”
Using the standard for “willfulness” set forth in previously published Circular 230 cases (“a voluntary, intentional violation of a known legal duty”), the administrative law judge found that the various explanations given by Petrillo for his failures to file did not negate his willfulness.

However, the judge explicitly declined to adopt the IRS’s position that willful evasion of payment for purposes of Circular 230, Section 10.51(a)(6), should be analogous to trust fund recovery penalty assessments. Finding that the failures to file were significant enough by themselves, the judge ordered disbarment without addressing the failures to pay.

In his appeal, Petrillo argued that the judge applied a willful negligence standard rather than a willfulness standard; the judge applied the wrong standard for willfulness; material facts were in issue making summary judgment inappropriate; and he was denied due process because the standards were changed from willfulness to willful negligence after the complaint was filed.

The Appellate Authority determined that the administrative law judge had correctly and consistently applied the existing standard for willfulness to Petrillo’s conduct; that the judge had correctly determined from the deposition testimony and briefs that there were no material factual issues remaining to be heard; and that the judge’s findings of fact were well supported by the record and not clearly erroneous.

Finding, during the periods in issue, that Petrillo was not mentally or physically incapacitated; was gainfully employed; prepared tax returns for others; engaged in legal work for clients; and conducted his own personal business, the Appellate Authority concurred in the judge’s decision to disbar, noting that Petrillo had been previously suspended by the Office of Professional Responsibility from 1993 through 1997.

“This is yet another in a line of final agency decisions in the past two years which reiterate that practitioners cannot expect to be excused for not filing or late filing their own tax returns when the record reflects their active engagement in other tax and business matters on behalf of paying clients, or active involvement with their own personal activities which belie any debilitation,” said OPR director Karen L. Hawkins.

True, Cryer was acquitted of willfully failing to file for certain specific years. Yet, despite his claims to the contrary, he has never gotten a concession that he was not required to file. And I believe a sound argument could be made that his continuing failure to file for those years, and his failure to file for the tax years since then, has certainly been willful. Yet instead of pursuing the cases, the IRS seems to have not sought enforcement of the records subpoena orders and declined to object to an indefinite continuance in Cryer's 2009 Tax Court case. And with those awkward little matters put on the back burner indefinitely, Cryer is now hopscotching around the nation to represent clients in Federal and State Courts on tax and tax-related matters.

Cryer may or may not be filing tax returns on behalf of his clients, but he certainly is maintaining a high profile in Federal and State Courts. Given his open refusal to cooperate with the courts and to comply with Federal District Court orders on his personal tax matters, I'm wondering why we haven't gotten wind of a disbarment hearing against Cryer.

[wserra]

What I'm wondering now is why Cryer still hasn't been shut down.

Depending on what you mean by "shut down", this question has many different answers. He was indicted, which can in fact be a fairly effective way to shut someone down. It wasn't in his case, but that's life in the big city. As to why certain agencies - the IRS, the LA bar - haven't acted more aggressively administratively, there is no way for an outsider to know. As for the action to enforce the IRS summons (09-cv-1144, LAWD), the last entry in the docket is the DJ's order of 6-17-10, adopting the R&R of the M-J and enforcing the summons over Cryer's stupid blanket Fifth Amendment objection. For all we know, Cryer has since complied. I would surely expect to find a govt show cause in the docket had he not. Do you have any information to the contrary? Finally, as to the Tax Court case, Cryer requested an adjournment of the trial.

He is still representing clients in court on tax matters.

Yes, but not very often, as far as PACER shows. Since his acquittal, he has appeared as counsel in three civil and three criminal cases. I think he spends more of his time preaching to particularly dumb choirs than practicing law.

Welcome to Quatloos, Kestrel.

[Kestrel]

Thanks for the welcome. I'm a first-time poster, but a long time lurker.

No, I haven't got anything certain and, Cryer being Cryer, I am not about to contact him myself again for a status update. I've already had more of his self-righteous pontificating than I can stomach. Trying to have a rational discussion with Cryer on tax issues is pointless. I could spend all day detailing court rulings on tax matters, and he simply ignores anything which he doesn't agree with. The IRS published a lengthy document detailing frivolous tax positions and Cryer takes one of two postures on each point: he either says no "legitimate" tax protestor would make such an argument, or he makes a blanket statement that the IRS has misinterpreted the law and all cited court findings are insignificant or inapplicable.

The last I update I heard on Cryer's District Court matter was from the mutual "friend" I mentioned, who told me Cryer was not concerned about what the judge's order said. Cryer might have complied, but I think it more likely he is letting the IRS try to find whatever records they can without his help.

About the time the District Court order was issued Cryer was busy with other stuff anyway. He and my other "friend" were preparing to film a video with Joe Banister, a mock trial of the IRS in support of their tax-denier positions. The video was finished last fall, and Cryer is now trying to raise money to distribute 50,000 copies of his DVD to IRS employees. This guy doesn't want a low profile; he's deliberately poking his finger in their face and challenging the IRS to respond.

The whole scenario is flabbergasting. **Sigh** I guess I'll go back to lurking.

[notorial dissent]

And, what is going to happen to him is the same thing that happened to Pete Hendrickson and Larkin Rose, he is eventually going to go down in flames, and for exactly the same reasons they did, they got it wrong, and they let their egos run rampant and get control of their mouths. Both of them got jail time and both of them got shot out of the water because they thumbed their noses at the IRS claiming "they won't come after me because I'm right", and they were both ever so wrong. It is inevitable. I think it is going to be more spectacular because Cryer has a bigger mouth, and has been farther down the well than the other two, but that is just my opinion. I think he will keep pushing it until he gets himself in really deep.

[grixit]

About the time the District Court order was issued Cryer was busy with other stuff anyway. He and my other "friend" were preparing to film a video with Joe Banister, a mock trial of the IRS in support of their tax-denier positions. The video was finished last fall, and Cryer is now trying to raise money to distribute 50,000 copies of his DVD to IRS employees.

Hmm, nothing about it on any of his websites. But why does he need to distribute copies anyway? He's put videos on Youtube before, he should just put this one there as well, then hire a few people to hold up signs with the link on them outside of IRS buildings all over the country.

[wserra]

Cryer might have complied, but I think it more likely he is letting the IRS try to find whatever records they can without his help.

I don't have much to add to what I previously wrote, but I doubt it. DOJ has their order enforcing the summons. If Cryer has not complied, the typical DJ is hardly shy about signing a show cause and then, in the event of continued non-compliance, holding the Cryers of the world in contempt. DOJ knows this perfectly well. Why would they not seek an order citing him?

[Kestrel]

Hmm, nothing about it on any of his websites. But why does he need to distribute copies anyway? He's put videos on Youtube before, he should just put this one there as well, then hire a few people to hold up signs with the link on them outside of IRS buildings all over the country.

Cryer mentions it here on one of his website's fund-raiser pages: http://www.truthattack.org/jml/index.ph ... Itemid=271

We want to send Joe Banister's DVD challenging his former colleagues with the IRS to investigate the law for themselves to thousands of IRS agents and employees and another DVD by Joe and attorneys Tom Cryer, Larry Becraft, Peter Gibbons, John O'Neill Green and George Harp to judges and prosecutors showing them why those in the Tax Honesty Movement are not criminals. Both are accompanied by the very instructive and persuasive CD, "Innocence Revealed", but we're nowhere near able to do that. Joe estimates that if we can get the DVD and the CD to as many as half of the IRS's 100,000 employees we can expect to see 500 new "Joe Banisters" on the scene. Imagine what that would do for our movement.

A generous supporter has paid for the air fare for Joe and a host of attorneys to gather for the taping and is helping with the cost of reproducing the DVD's and CD's, but we still have cases, labeling, packaging and postage to pay for.

The "other DVD" and the Joe Banister fly-in which he cites is what I am talking about. This DVD was filmed last fall in the Bossier Parish Courthouse in Benton, LA. Unbelievably (for me), the people who control access to the courthouse determined that filming of a tax-protestor video fell under public facility access and use rules; courtroom use could not be denied so long as it did not interfere with official business and adequate site security was provided. Ever since Hurricane Katrina drove the movie production industry north from New Orleans, government agencies in northern Louisiana have been tripping all over themselves to encourage local film-making of all kinds.

Anyway, there it is.

[.]

We want to send Joe Banister's DVD challenging his former colleagues with the IRS to investigate the law for themselves to thousands of IRS agents and employees

Joe estimates that if we can get the DVD and the CD to as many as half of the IRS's 100,000 employees we can expect to see 500 new "Joe Banisters" on the scene. Imagine what that would do for our movement.

So, Banister expects that only 1% of IRS employees are total idiots? Seems to be rather low on the expectation side, considering that he knows that he's "right."

No doubt there at least 500 idiots working for the IRS, but, can you find even 10 of them who are other than low-level flunkies and dumb enough to forfeit their jobs and risk prison time? Sounds like more fund-raising desperation as their herd of marks diminishes.

As has been pointed out, we've probably not heard the last of Cryer's legal trevails. The DoJ tax division may be busy and slow, but they ain't stupid.

[Doktor Avalanche]

Trying to have a rational discussion with Cryer on tax issues is pointless. I could spend all day detailing court rulings on tax matters, and he simply ignores anything which he doesn't agree with.

I got that impression when I spoke to him, too.

[Quixote]

Joe estimates that if we can get the DVD and the CD to as many as half of the IRS's 100,000 employees we can expect to see 500 new "Joe Banisters" on the scene. Imagine what that would do for our movement.

It would saturate the market for bullsh*t. The detax gurus are already engaged in some nasty turf wars. I doubt 500 more purveyors of gibberish could even get their feet in the door.

[grixit]

Joe estimates that if we can get the DVD and the CD to as many as half of the IRS's 100,000 employees we can expect to see 500 new "Joe Banisters" on the scene. Imagine what that would do for our movement.

It would saturate the market for bullsh*t. The detax gurus are already engaged in some nasty turf wars. I doubt 500 more purveyors of gibberish could even get their feet in the door.

One of these contestants will be the next great revolutionary, following in the footsteps of Samuel Adams, Robespierre, Trotsky, Zapata, Larken Rose, and Ed Brown! The others-- well, the others will be footnotes. So, who has what it takes to turn a scattering of disfunctional malcontents into a great army of liberation? Find out tonight on Sovereign Idol!

In this episode, 5 of our contestants will try to remember how they've decided to spell their names, the rest will attempt to recite the Constitution from memory, That's the real Constitution, not the stretched and twisted silly putty copy!

[.]

That spam gibberish is worthy of Van Pelt.

[notorial dissent]

If they claim they're making a dvd, then they can beg for money for the project, if they were just doing another utube, it would be a lot harder to justify begging for money, and this way they won't have to justify what happens to the money when they never get enough to actually do it.

[Kestrel]

If they claim they're making a dvd, then they can beg for money for the project, if they were just doing another utube, it would be a lot harder to justify begging for money, and this way they won't have to justify what happens to the money when they never get enough to actually do it.

You are absolutely right!!!

Come to think of it, for a fellow hoping to talk folks into handing him $150,000, he's surprisingly un-forthcoming with any financial statements, or "sources and uses of funds" statements, or.....

Oh, wait a minute...

If he revealed any financial information to his prospective donors, the IRS could get ahold of it and use it against him.

I think I'll go bury my money in a leaky mayonaisse jar in the back yard instead. That way when the acid rain turns the silver into slag, at least I'll have some evidence of what happened to it.

[The Observer]

The Hopkins' appeal to the 10th Circuit garnered a lengthy decision yesterday that should be no surprise to anyone here:

For the foregoing reasons, we AFFIRM the district court's denial of Sharon Hopkins's motion to dismiss the indictment. We also AFFIRM the sentences of both Sharon Hopkins and Mark Hopkins.

Mark Hopkins has also filed a motion for leave to file a pro se reply brief. Because he is represented by counsel who previously submitted a brief on his behalf, his motion for leave to file a pro se supplemental brief is DENIED pursuant to this court's "policy of addressing on direct appeal only those issues raised by counsel." United States v. McDermott, 64 F.3d 1448, 1450 n.1 (10th Cir. 1995).

D.C. No. 2:09-CR-00863-MCA-1 and MCA-2