"They think I'm an evil dude" -- Snipes

[Demosthenes]

Snipes: 'I wasn't running from tax evasion charges'
14/12/2007 - 10:40:09

Wesley Snipes has broken his silence over his 2006 tax evasion scandal, denying allegations he tried to avoid charges by fleeing to Namibia.

Snipes is due to stand trial in Florida in January, on charges he fraudulently claimed tax refunds of almost $12m (€8.2m) in 1996 and 1997. He is also accused of failing to file tax returns from 1999 to 2004.

When the indictment was unsealed in October 2006, Snipes was shooting a movie, 'Gallowwalker', in Namibia - a country that doesn't have an extradition treaty with America.

But the star flatly denies claims his failure to return to America immediately meant he was deliberately trying to avoid the charges against him.

He says: "They positioned it like: `He's irresponsible, dangerous, guilty - this is why he's in Africa.'

"People think I'm Nino Brown (Snipes' gangster character in 1991's 'New Jack City') or (vampire character) 'Blade'. They think I'm an evil dude."

And Snipes claims he has no idea why he has been charged, as he never received the tax refunds in the first place.

He adds: "I never got a dime. I didn't defraud the government by taking money that was not mine. We never got it."

[Evil Squirrel Overlord]

In other news: Foiled bank robber denies commiting crime because he left without the cash.

He adds: "I never got a dime. I didn't rob the bank by taking money that was not mine. We never got it."

[Demosthenes]

The full five page article.

http://www.ew.com/ew/article/0,,20165873,00.html

I lover Snipes' description of who "they" are.

[ASITStands]

When asked who ''they'' are, Snipes replies, ''People in positions of authority and who control mass media.''

Let me see. This guy makes a living off media, and he wants to blame them when he gets in trouble? I think it's a 'black' thing. That probably sounds racist, but I expect him to play that card.

Instead, he claims he was merely following the counsel of his advisers. ''The accountants say you're entitled to a refund because of these particular rules and regulations,'' he says. ''So you say all right.... If someone tells me I'm entitled to a refund, I'll go for the refund!''

Here we go. "The ebil accountants made me do it!" Can you say, "G-r-e-e-d?"

Shouldn't he remain silent? Or, is he trying to use the ebil media to play our sympathies? Actually, blaming the money-grubbing, corporate-controlled media and its connection to government is the thing today. He's got it right if he wants to play on the public's sympathies, and he's 'black' to boot.

[grixit]

When asked who ''they'' are, Snipes replies, ''People in positions of authority and who control mass media.''

Let me see. This guy makes a living off media, and he wants to blame them when he gets in trouble? I think it's a 'black' thing. That probably sounds racist, but I expect him to play that card.

And maybe the jew card? It would go along with "control mass media".

[ASITStands]

And maybe the jew card? It would go along with "control mass media".

Or, any number of other 'victim' cards.

The 'Jew' card would be played against the media and possibly the government. The 'black' card would be part of the 'victim' cards, and the 'victim of my accountants' card would be just more of same. Keep trying! Maybe we can come up with a 52 card deck.

[Bud Dickman]

Snipes' Attorney Says Client Just Asking IRS Questions

By Thomas W. Krause of The Tampa Tribune

Published: January 11, 2008

OCALA - Did the action-movie star duck and roll under the tax system, or was he simply asking the Internal Revenue Service for help in filing his returns?

On Monday morning, federal prosecutors, defense attorneys and a judge will sift through dozens of prospective jurors from four Central Florida counties with the goal of seating a 12-member jury. The jury will take up to four weeks to determine whether actor Wesley Snipes is guilty of conspiracy and presenting false claims for millions of dollars in tax refunds. Snipes also is charged with failing to file tax returns for six years.

If convicted, he faces up to 16 years in prison.

An October 2006 federal indictment states that Snipes, along with two men who ran a tax-fraud scheme, filed for $11.4 million in false tax returns. Snipes and his co-conspirators argued that the U.S. government can only tax residents on income generated in other countries, the indictment states. That claim has been proved false by several courts, according to the indictment.

Snipes at one point called his usual tax preparers and told them to file the refund requests as he directed, the indictment states. The tax accountants told him the filing would be improper, prosecutors allege.

The two men charged with Snipes, Eddie Ray Kahn and Douglas P. Rosalie, ran an organization out of Lake County that purported to be an aggressive accounting firm, according to the indictment. It morphed into a new group, Guiding Light of God Ministries, a supposed nonprofit Christian organization. Both organizations, the indictment states, "sold fraudulent tax schemes."

Snipes' lead attorney, Robert G. Bernhoft, said the issue in court will not be about various tax theories. Snipes, Bernhoft said, did not try to defraud the government. He simply asked the IRS whether this innovative way to file returns was allowed.

"He did what every other American is entitled to," Bernhoft said. "He asked the IRS for information. Asking questions is not a crime, even if the IRS would like it to be."

Bernhoft said the IRS is holding $110 million in unclaimed tax refunds. If no one is allowed to ask about the money, the IRS will not have to pay it back, he said.

Reporter Thomas W. Krause can be reached at (813) 259-7698 or tkrause@tampatrib.com.

[jg]

"He did what every other American is entitled to," Bernhoft said. "He asked the IRS for information. Asking questions is not a crime, even if the IRS would like it to be."

The Kuglin defense is worth a try.

[.]

So, assuming the article accurately describes the "defense," is Bernhoft trying to get disbarred?

[LPC]

From today's NY Times:

January 14, 2008
Wesley Snipes to Go on Trial in Tax Case
By DAVID CAY JOHNSTON

From 1999 to 2004, the actor Wesley Snipes earned $38 million appearing in more than half a dozen movies, including two sequels to his popular vampire thriller “Blade.”

The taxes he paid in the same period? Zero.

But unlike other celebrities who find themselves on the wrong side of the Internal Revenue Service, Mr. Snipes has a flamboyant explanation: he argues that he is not actually required to pay taxes.

Mr. Snipes, who is scheduled to go on trial Monday in Ocala, Fla., has become an unlikely public face for the antitax movement, whose members maintain that Americans are not obligated to pay income taxes and that the government extracts taxes from its citizens illegally.

His trial has become the most prominent income tax prosecution since the 1989 conviction of the billionaire New York hotelier, Leona Helmsley, who went to prison for improperly billing personal expenses to her business.

Tax deniers maintain that the law only appears to require payment of taxes. All their theories have been rejected by the courts, including the one invoked by Mr. Snipes, which is known as the 861 position, after a section of the federal tax code.

Adherents say a regulation applying the 861 provision does not list wages as taxable, though it does say that “compensation for services” is taxable. The courts have uniformly rejected all such theories, and eight people have been sentenced to prison after not paying taxes based on the 861 argument.

Despite the court rulings, juries have acquitted some prominent tax resisters in recent years, and failed prosecutions have encouraged others to join. Even when the government has failed to obtain convictions, it succeeded in collecting the taxes through civil enforcement.

J. J. MacNab, a Maryland insurance analyst who tracks people who deny they owe taxes and has testified before Congress about the movement, said that an acquittal of Mr. Snipes would be a severe setback for the I.R.S.

“He will get more press and attention than any other victory by the tax deniers, and the growth in new members will be exponential,” she said.

Mr. Snipes, 45, is charged with two felonies: conspiracy to defraud the government and filing a false claim for a $7 million refund (a claim for the year 1997, before he stopped paying taxes). He is also charged with failing to file tax returns for the six years starting in 1999. Prosecutors say they intend to show that Mr. Snipes moved tens of millions of untaxed dollars offshore and gave the government three worthless checks totaling $14 million to cover some taxes.

In court papers and interviews, Mr. Snipes says that he is not guilty and that he acted on the advice of two tax professionals. They are being tried alongside him and are promoters of the 861 position and other tax theories.

One is Douglas Rosile, who was stripped of his accounting license in 1997. The other is Eddie Kahn, who has served prison time for tax crimes. Both are under federal court order to stop promoting tax evasion, including the 861 position.

The lawyer representing Mr. Snipes at trial is Robert Bernhoft of Milwaukee, who has been barred by court order since 1999 from selling a program under which he said people could legally stop paying income taxes.

Mr. Snipes, who grew up in the Bronx, is best known for tough-guy roles in movies like “Blade,” “U.S. Marshals,” and “The Passenger,” but he also starred in films by Spike Lee (“Jungle Fever,” “Mo’ Better Blues”) and Ron Shelton (“White Men Can’t Jump”).

His involvement with the tax resistance movement may stem from his association with the Nuwaubians, a quasi-religious sect of black Americans who promote antigovernment theories and who set up a headquarters in Georgia in the early 1990s.

In 2000, Mr. Snipes sought a federal permit for a military training compound on land next to the Nuwaubian camp; the Bureau of Alcohol, Tobacco and Firearms rejected the request.

“Snipes is already drawing whole new demographics to the movement,” Ms. MacNab added. “Tax protesters used to be white, 50 or older, blue-collar, rural and often connected to racist movements, but Snipes is young, urban and famous.”

She and others said the movement got a boost in 2005 when a jury acquitted Joseph Banister, a former criminal investigator for the I.R.S., who used his acquittal as proof that his views on the tax law were correct. One problem with that case was that even though his co-defendant, Al Thompson of Lake Shasta, Calif., was acquitted of conspiracy in a separate trial, Mr. Thompson is serving six years in prison for failing to withhold taxes from his employees and turn the money over.

Federal prosecutors also failed to convict a Louisiana lawyer, Tom Cryer, who, like Mr. Snipes, said he sincerely believed that he was not required to pay taxes. Another resister, Robert Lawrence of Peoria, Ill., had his case dropped in 2006 after arguing that tax forms violate the federal Paperwork Reduction Act — a strategy that had been falling out of favor among tax opponents but has since gained new adherents. Both men were still liable for the taxes after their cases.

Prosecutors also failed to convict a FedEx pilot, Vernice Kuglin of Memphis, who said she wrote the I.R.S. asking what law makes her liable for taxes, but got no response. She later signed papers conceding she owed more than $600,000 in taxes, and last week her goods, including her 14-year-old vehicle, were auctioned in Memphis. Ms. Kuglin said that despite the court filing, she continues to believe that she does not owe taxes.

Tax specialists and lawyers say that the Snipes case hinges on whether he can persuade jurors that he sincerely believed that he did not have to pay taxes, while prosecutors will argue that he was just trying to avoid them. The Supreme Court has ruled that people can make such an argument, but two leading defense lawyers said that Mr. Snipes might have a hard time using it as a defense.

Michael Louis Minns, a Houston lawyer who has defended and won acquittals for tax protesters, said that the three bad checks that Mr. Snipes sent the government to cover $14 million of taxes would seem to destroy a defense based on that argument.

“You can win acquittal with a good-faith defense that you sincerely believed you do not have to pay taxes,” Mr. Minns said. “But not if you make inconsistent claims.”

William Cohan, a lawyer in Rancho Santa Fe, Calif., who also represents tax opponents, said another hurdle is the refund claim form signed by Mr. Snipes. The signature statement, or jurat, was altered so that instead of saying it was signed under penalty of perjury, the word “no” was inserted before “penalty.”

“That’s just devastating because if you sincerely believe you are not required to pay taxes, why would you alter the jurat?” Mr. Cohan said.

[Famspear]

David Cay Johnston wrote:

Another resister, Robert Lawrence of Peoria, Ill., had his case dropped in 2006 after arguing that tax forms violate the federal Paperwork Reduction Act — a strategy that had been falling out of favor among tax opponents but has since gained new adherents.

The above verbiage, while denotatively correct, might inadvertently leave an incorrect impression with readers of the New York Times. Specifically, although Lawrence did raise the argument, the Lawrence case prosecution was not dropped because of the OMB control number (Paperwork Reduction Act argument). Tax protesters have repeatedly tried to mislead people on this point.

As previously explained elsewhere, the IRS agents who had calculated Mr. Lawrence's tax liability discovered errors they themselves had made -- based on information obtained from Lawrence's own tax returns, regarding the taxpayer's tax basis in certain property Lawrence had sold. The IRS agents discovered that Lawrence had more tax basis than they had originally calculated -- therefore, lower gains or even losses, and thus lower taxes. The IRS agents themselves brought their errors to the attention of the government lawyers, who then asked that the charges be dropped (and they were). The IRS employees recognized that their calculations had incorrectly stated Lawrence's tax liability. Neither the Lawrence court nor any other Federal court has upheld the phony OMB control number argument.

In a further development in the Lawrence case, in March of 2007 the United States Court of Appeals for the Seventh Circuit rejected both the OMB argument and the tax protester's request for compensation. The following is an excerpt from the Court's decision:

According to Lawrence, the Paperwork Reduction Act of 1995 (PRA) required the Internal Revenue Service to display valid Office of Management and Budget (OMB) numbers on its Form 1040 [ . . . ]. Lawrence argues that the PRA by its terms prohibits the government from imposing a criminal penalty upon a citizen for the failure to complete a form where the information request at issue does not comply with the PRA. Lawrence never explains how this argument is even relevant to the three counts involving tax evasion, but even as to the other three counts, it must fail [ . . . ] Lawrence's brief represents an attempt to prove that the PRA could present a valid defense to the criminal charges. Yet Lawrence conceded at oral argument that no case from this circuit establishes such a proposition, and in fact Lawrence cites no caselaw from any jurisdiction that so holds. In contrast, the government referenced numerous cases supporting its position that the PRA does not present a defense to a criminal action for failure to file income taxes [ . . . ] Lawrence provides no explanation of how government conduct can be vexatious, frivolous, or in bad faith when there is no law contrary to it.

--from page 2 of the Judgment, March 26, 2007, United States v. Lawrence, United States Court of Appeals for the Seventh Circuit, No. 06-3205, docket entry 39.

I am positive it was not Mr. Johnston's intent to leave an incorrect impression about the Lawrence case. Maybe I'll look around for his email address, or some way to contact him.

[Demosthenes]

David is aware of all of that.

[Famspear]

OK. I sent him the email anyway. I think he has been performing a great public service over the years with his writings on tax issues.

[Demosthenes]

He has indeed. (He also reads Quatloos ).

[ASITStands]

As previously explained elsewhere, the IRS agents who had calculated Mr. Lawrence's tax liability discovered errors they themselves had made -- based on information obtained from Lawrence's own tax returns, regarding the taxpayer's tax basis in certain property Lawrence had sold. The IRS agents discovered that Lawrence had more tax basis than they had originally calculated -- therefore, lower gains or even losses, and thus lower taxes. The IRS agents themselves brought their errors to the attention of the government lawyers, who then asked that the charges be dropped (and they were). The IRS employees recognized that their calculations had incorrectly stated Lawrence's tax liability. Neither the Lawrence court nor any other Federal court has upheld the phony OMB control number argument.

An acceptable explanation. However, I still have difficulties understanding why it was dismissed with prejudice. Sure. They might not have considered it worth the effort to bring a new indictment, but that doesn't warrant with prejudice. They could simply have chosen not to bring new charges.

I'm sure they're looking at civil issues.

What if they were to uncover unknown amounts of income or some trust? Seems to me they were looking at his association with the Joy Foundation, so that could yield more information at some point, unless they've give up on the Joy Foundation.

[wserra]

From today's NY Times:

Mr. Snipes says that he is not guilty and that he acted on the advice of two tax professionals. They are being tried alongside him

Dum-da-DUM-DUM.

[The Observer]

From today's NY Times:

Mr. Snipes says that he is not guilty and that he acted on the advice of two tax professionals. They are being tried alongside him

Dum-da-DUM-DUM.

Don't you mean "Dumb-da-DUMB-DUMB?"

[Famspear]

ASITStands wrote:

[ . . . ] I still have difficulties understanding why it was dismissed with prejudice. Sure. They might not have considered it worth the effort to bring a new indictment, but that doesn't warrant with prejudice. They could simply have chosen not to bring new charges.

Yes, the government did specifically request that the court dismiss the case "with prejudice." I don't know the background on that.

[Quixote]

ASITStands wrote:

[ . . . ] I still have difficulties understanding why it was dismissed with prejudice. Sure. They might not have considered it worth the effort to bring a new indictment, but that doesn't warrant with prejudice. They could simply have chosen not to bring new charges.

Yes, the government did specifically request that the court dismiss the case "with prejudice." I don't know the background on that.

Iirc, the judge refused to agree to a dismissal w/o prejudice, so the DoJ had only two options, no dismissal or dismissal with prejudice.

[LPC]

ASITStands wrote:

[ . . . ] I still have difficulties understanding why it was dismissed with prejudice. Sure. They might not have considered it worth the effort to bring a new indictment, but that doesn't warrant with prejudice. They could simply have chosen not to bring new charges.

Yes, the government did specifically request that the court dismiss the case "with prejudice." I don't know the background on that.

The government tried to amend the indictment, and the judge refused, which meant that, if they withdrew, they would have had to start all over. A couple of possible problems:

1. They might have had problems with the statute of limitations on some of the counts.

2. The judge might not have been willing to approve a dismissal without prejudice. The decision to withdraw the indictment came on the Friday before the Monday the jury trial was scheduled to start, and the judge might have been annoyed enough by the waste of judicial resources to both refuse the amendment to the indictment and refuse to approve dismissal without prejudice. Assuming that the judge can do such a thing (and I always assume judges can pretty much do as they want until I see evidence they can't), the government might have had only two choices: Go forward with an indictment with incorrect tax numbers, or dismiss with prejudice, and they chose the latter.