Milton Street trial

[Demosthenes]

Posted on Thu, Feb. 14, 2008


T. Milton Street, tax resister, takes the stand
By Joseph A. Slobodzian

INQUIRER STAFF WRITER

To his many careers -– street food vendor, state legislator, business entrepreneur and political gadfly – T. Milton Street today added another: tax resister.

Taking the witness stand in his trial on mail and wire and tax-evasion, Street told a federal jury about his intense study of the history of the federal income tax, the tax statutes and relevant Supreme Court decisions and has come to the conclusion that the tax is unconstitutional.

"If you find it, look it up for me and I'll plead guilty to all these charges," an animated Street told Assistant U.S. Attorney Jennifer Arbittier Williams.

Williams persisted in trying to elicit from Street the fact that he earned more than $2 million in consulting fees from 2000 to 2004 and paid no taxes on it, and that he failed to even file tax returns for three years.

"Street kept filibustering the prosecutor with his legislative research into the tax code, finally saying, "Miss, why can't just show me the law so I can plead guilty?"

"Let's take five minutes," interrupted U.S. District Judge Legrome D. Davis. Then, outside the jury's presence, Davis quietly but firmly instructed the grinning Street, 68, about answering questions in court and the fact that his comments about pleading guilty were "not fair" to a jury hearing evidence in a trial that he wanted.

Earlier in the morning federal prosecutors ended the government's case against former state legislator T. Milton Street, opening the door for the beginning of the defense case.

After Street and his witnesses are done, defense attorney Guy Sciolla will present the case for Street's co-defendant John H. Velardi Sr.

The indictment against Street alleges that he failed to pay taxes on $2 million worth of consulting fees and income not derived from his $30,000-a-year food-vending business between 2000 and 2004, and failed to even file a tax return in 2002, 2003 and 2004.

In addition to the tax charges against him, Street and Velardi, 54, of Media, are charged with wire and mail fraud in an alleged 2003 scheme to defraud a Vietnamese businessman of $80,000 by selling him the rights to a $3.2-million airport maintenance subcontract that Street and Velardi knew did not exist.

Previous witnesses have testified that Street and Velardi wanted to assign the airport subcontract to Thanh Nguyen and his V-Tech Services Inc. to recoup money Street owed Velardi's employer, Philadelphia Airport Services, or PAS, the main maintenance contractor at the airport.

Prosecutors, however, contend that the rights to the subcontract between PAS and Street's Notlim Inc. were no longer Street's to sell.

In June 2003, airport officials had cancelled the Notlim subcontract after Mayor John Street ordered his older brother to withdraw from the deal because it appeared inappropriate. Prosecutors say the ex-mayor was not involved in his brother's alleged crimes.

Nguyen testified Monday that after he paid Street $80,000, the assignment of the subcontract kept getting postponed and Street and Velardi stopped returning his calls.

Prosecutors say that after John Street's election as mayor in 1999, his older brother began hiring himself out as a consultant who could provide an entre to City Hall and city contracts.

[Famspear]

I had never heard of this guy, but here is his Wikipedia entry:

http://en.wikipedia.org/wiki/Milton_Street

[Demosthenes]

Posted on Fri, Feb. 15, 2008

Milton Street to court: Show me where it says I have to pay taxes
By MICHAEL HINKELMAN
Philadelphia Daily News

hinkelm@phillynews.com 215-854-2656

MILTON STREET took the stand in his own defense yesterday and declared he's "like a rolling stone."

Then for nearly two hours, Street rocked the courtroom like the Rolling Stones, including a defiant claim that the federal government has no right to collect income taxes.

The flamboyant and outspoken brother of ex-mayor John Street told jurors that he didn't even file federal tax returns for three years and also accepted $50,000 in cash from a businessman at a Center City hotel - and that was in his defense.

Testifying in his federal tax-evasion and fraud trial, Street - a former state senator in the public eye for more than three decades - was alternately feisty and folksy. He wore a bright sports jacket that he acknowledged paying $3,500 for - not long after the deal at the center of the case.

"I'm like a rolling stone, you know," he told jurors, frequently looking at them as he testified. When word spread around the courthouse that Street was testifying, the courtroom filled up quickly.

Closing arguments in the case are slated to begin next Tuesday.

Yesterday, Street took on both of the main allegations against him - that he didn't pay taxes on more $2 million he earned as a consultant from 2000 to 2004, and that he and a co-defendant defrauded a businessman at the Philadelphia airport.

At one point, while under cross-examination by assistant U.S. Attorney Jennifer Williams, Street went on an anti-income tax rant that lasted more than five minutes.

He admitted to Williams that he did not file tax returns for 2002, 2003 and 2004 - still hasn't filed them - but said he would.

Street had an explanation: He said he researched the issue and concluded that there was no federal law authorizing the IRS to levy and collect a direct tax on the American people's wages.

Then, he added: "I will say to you, Ms. Williams, right now, if you can find that law for me and bring it in here, I will plead guilty to all these charges because my research says it doesn't exist."

After Street persisted, saying he would plead guilty if Williams simply complied with his request, Davis excused the jury and admonished Street for infringing on his courtroom "rules."

Regarding the business deal, Street admitted he took $50,000 in cash from a businessman to assign the rights to an airport maintenance subcontract he held - even though he didn't have the permission of the prime contractor, Philadelphia Airport Services, or PAS.

The cash was given to Street in a black bag at a breakfast meeting at the Doubletree Hotel on Sept. 22, 2003.

The assignment agreement required Street's company, Notlim, to have "written consent" of the prime contractor before it could be assigned.

"Did you ever get permission from PAS?" asked prosecutor Williams.

"No," Street replied, adding that he had advised the businessman, Thanh Nguyen, that he tried to get the written consent and that Nguyen didn't have to sign the agreement if he wasn't comfortable with it.

Both men subsequently signed the agreement, and Street said he never returned the $50,000 - or $30,000 Nguyen later loaned him.

Nguyen testified earlier this week that after Street sold him the rights to his subcontract, Street and co-defendant John H. Velardi, Sr. stonewalled him and stopped taking his telephone calls.

The city had actually cancelled Street's airport subcontract in June 2003, three months before the meeting at the Doubletree.

A former counsel for PAS' managing partner testified earlier this week that he found an unsigned and undated consent letter, which was not on PAS letterhead, inside Velardi's desk.

Street said yesterday the letter had been typed by his then-lawyer, Sherman Toppin, to give to Velardi to see if it was the "proper language" needed for PAS' consent.

Street and Velardi have been charged with defrauding Nguyen of the $80,000 in connection with an alleged scheme to sell him the rights to Street's $3.2-million airport maintenance subcontract.

Velardi, who was the facilities maintenance director for PAS, did not testify yesterday in his own defense, although seven character witnesses attested to Velardi's stellar reputation.

Williams also questioned Street about $98,000 he paid to Matthias Schwabe, a former maintenance manager for PAS, who earlier pleaded guilty to fraud and filing a false tax return. He testified for the government.

Schwabe said he used the money to make a down payment on his house and to pay a contractor, and later used PAS money to do personal favors for Street.

Street testified they were loans but admitted he didn't have any loan agreements with Schwabe.

"So Matt Schwabe lied?" asked Williams.

"Well, I think everybody in here know that," Street replied.

"And Thanh Nguyen lied?"

"I think everybody in here know that," Street replied.

"And you're telling the truth?"

"Absolutely, without question, may I explain that?" Street replied. *

[Demosthenes]

Someone recorded Milton's time on the stand, which I think is a serious no no in a federal courtroom. Nonetheless, it's highly entertaining:

http://www.philly.com/inquirer/multimedia/15648677.html

If you only have a few minutes, start listening at the 28 minute mark.

[Demosthenes]

His arguments are the OMB number on the Form 1040, no statute makes one liable for paying a direct tax, and no law makes him liable.

[The Operative]

Based upon what has been posted here, I hope the prosecution has presented a good case and the jury convicts him.

[Demosthenes]

The Indictment:

http://www.cheatingfrenzy.com/street1.pdf

Ugly. Makes our day to day tax deniers look like angels.

[Famspear]

LPC wrote:

Then you're lucky, because he's been a Philadelphia-based attention whore for years.

I hope the guy is now getting the attention he deserves - if you know what I mean.

[Bud Dickman]

Famous experts quoted in this article.

Street's position on taxes rejected often by courts

By Joseph A. Gambardello

Inquirer Staff Writer
In arguing that federal income taxes are unconstitutional, T. Milton Street Sr. is far from alone - but when it comes to the law, he has gone way out on a very weak limb.

Time and time again, courts have ruled that while it is perfectly legal to believe that income taxes are unconstitutional, that is no defense for not paying them.

The latest high-profile court case in which this was an argument involved the actor Wesley Snipes.

On Feb. 1, a federal jury in Florida convicted the movie star of failing to file tax returns, but acquitted him of more serious felony charges of conspiracy and tax fraud.

Snipes, 45, must repay millions in back taxes and penalties, and he faces up to three years in prison when he is sentenced in April. Two of Snipes' codefendants - a tax protest leader and an accountant - were convicted of tax fraud and conspiracy and each faces up to 10 years in prison.

Snipes' views may have been inspired by his association with the Nuwaubians, a quasi-religious African American sect that promotes antigovernment theories.

The Constitution has allowed the government to collect taxes from the nation's early days, but it was not until the passage of the 16th Amendment in 1913 that the present federal income tax came into existence.

Protesters come in two varieties.

The first, known as resisters, recognize the government's right to collect income tax, but withhold payment on moral grounds, such as opposition to war or other government actions.

The second, to which Street claims to be an adherent, questions the legal foundation of income tax. The former Pennsylvania state senator is now on trial in federal court on charges of wire and mail fraud and tax offenses, including not filing returns and failing to pay income tax on more than $2 million in income.

Besides claiming that the 16th Amendment is unconstitutional or was improperly ratified, tax foes have argued that wages are not income, that gold is the only money, and that filing tax returns violates the privilege against self-incrimination.

In his own tax case, Street, the older brother of former Mayor John F. Street, on Thursday cited the "missing OMB control number."

Basically, this discredited theory holds that because some IRS forms and instruction booklets do not carry a control number from the federal Office of Management and Budget as required by the Paperwork Reduction Act, a citizen may ignore the rule that requires filing a federal tax return.

Daniel B. Evans, a trust and estate lawyer in Philadelphia, has called these protesters "tax deniers."

"Just like Holocaust deniers attempt to rationalize and justify their refusal to accept an indisputable historical fact . . . tax deniers attempt to rationalize and justify their refusal to accept indisputable historical facts," Evans writes on a Web page he has maintained on the subject since the 1990s.

"These people don't say, 'I'm protesting the tax laws.' They're saying. 'They just don't apply to me,' " he said yesterday.

The courts have called these positions frivolous, and in 1991 the U.S. Supreme Court ruled that a "belief that the federal income tax is unconstitutional . . . is not a defense to a charge of 'willfulness,' even if that belief is genuine and is held in good faith."

J.J. MacNab, a Bethesda, Md., insurance analyst who tracks tax deniers and has testified before Congress about them, said a "rough estimate" based on IRS figures would put their number about 500,000 nationwide.

She said they were a much smaller group, but the Internet helped swell their ranks.

Neither Snipes nor Street fits the profile.

"Primarily, they are white, they are over 50, and they have military experience," she said. "They tend to be right-wing and they tend to be very angry at the government."

But she said the belief is making inroads within the African American community and noted that on Thursday, Sherry Peel Jackson, a black former IRS agent turned tax denier, was sentenced in an Atlanta federal court to 48 months in prison for not paying her taxes.

MacNab said that when she heard that Street had claimed income taxes were unconstitutional, she wondered if he was inspired by Snipes' acquittal on the more serious charges against him.

But after hearing a tape of Street's testimony, she thought differently.

"He really knew the terminology, he really knew the words to say," MacNab said. "They were practiced. It was the 'Show me the law.' This is the stuff I hear hundreds of times a year. He actually rang true."

Street's trial resumes Tuesda

[LPC]

Daniel B. Evans, a trust and estate lawyer in Philadelphia, has called these protesters "tax deniers."

I have also called them "delusional morons," but that usually isn't quoted in the news.

[Doktor Avalanche]

Daniel B. Evans, a trust and estate lawyer in Philadelphia, has called these protesters "tax deniers."

I have also called them "delusional morons," but that usually isn't quoted in the news.

Rumor has it you've called them things that can't safely be quoted in the news.

[Nikki]

Oh, I SO much miss living in Philadelphia.

The Rizzo brothers, Milton and John Street, just great examples of the kind of politicians money will buy in that town.

Local politics there was more interesting thanalmost anything else in the news.

[Demosthenes]

http://willdo.philadelphiaweekly.com/ar ... _such.html

February 19, 2008
Milton: No Such Thing As Taxes

http://www.redlasso.com/ClipPlayer.aspx ... 8e66085586

Fox's Good Day Philadelphia showed Steve Keeley's interview with everyone's favorite member of the Street family, Milton, this morning at some ungodly hour. Milt talked more about his protest of the income tax, a view the Inquirer found somebody to compare to the Holocaust:

Daniel B. Evans, a trust and estate lawyer in Philadelphia, has called these protesters "tax deniers." "Just like Holocaust deniers attempt to rationalize and justify their refusal to accept an indisputable historical fact... tax deniers attempt to rationalize and justify their refusal to accept indisputable historical facts," Evans writes on a Web page he has maintained on the subject since the 1990s.

Evans' Tax Protester FAQ even has its own webspace! Since it's been around since the 1990s, I figured it'd be something like geocities.com/SiliconValley/Heights/4885/.

Closing arguments in the Milton Street trial are today. Only a short time before Uncle Milty walks out of court a free man and celebrates by opening up a hot dog cart.

[Demosthenes]

ANother on air interview with tax denier Street this morning.

http://www.myfoxphilly.com/myfox/MyFox/ ... cale=EN-US

[Demosthenes]

Posted on Tue, Feb. 19, 2008

Street trial deliberations begin today
By Joseph A. Slobodzian

INQUIRER STAFF WRITER

A federal jury has begun deliberating in the fraud and tax evasion trial of food vendor, former state legislator and political gadfly T. Milton Street.

The 12 jurors began reviewing the evidence presented during the five-day trial at 3:15 p.m. after 90 minutes of instruction in the applicable laws by U.S. District Judge Legrome D. Davis.

Earlier today, the jurors spent three hours listening to closing arguments by lawyers for Street, co-defendant John H. Velardi and the two federal prosecutors.

The indictment against Street, 68, of Moorestown, alleges that he failed to pay taxes on $2 million worth of consulting fees and income not derived from his $30,000-a-year food-vending business between 2000 and 2004, and failed to even file a tax return in 2002, 2003 and 2004.
In addition to the tax charges against him, Street and Velardi, 54, of Media, are charged with wire and mail fraud in an alleged 2003 scheme to defraud a Vietnamese businessman of $80,000 by selling him the rights to a $3.2-million airport maintenance subcontract that Street and Velardi knew did not exist.

Previous witnesses have testified that Street and Velardi wanted to assign the airport subcontract to Thanh Nguyen and his V-Tech Services Inc. to recoup money Street owed Velardi's employer, Philadelphia Airport Services, or PAS, the main maintenance contractor at the airport.

Prosecutors, however, contend that the rights to the subcontract between PAS and Street's Notlim Inc. were no longer Street's to sell.

In June 2003, airport officials had cancelled the Notlim subcontract after Mayor John Street ordered his older brother to withdraw from the deal because it appeared inappropriate. Prosecutors say the ex-mayor was not involved in his brother's alleged crimes.

Nguyen testified last Monday that after he paid Street $80,000, the assignment of the subcontract kept getting postponed and Street and Velardi stopped returning his calls.

Prosecutors say that after John Street's election as mayor in 1999, his older brother began hiring himself out as a consultant who could provide entre to City Hall and city contracts.

[Demosthenes]

Posted on Wed, Feb. 20, 2008


Street jury weighs his fate
By Joseph A. Slobodzian

INQUIRER STAFF WRITER

A federal jury resumed deliberations this morning in the fraud and tax evasion trial of T. Milton Street but returned to court after about 90 minutes, asking the judge for help resolving what seemed to be difficulty in gauging the legitimacy of Street's new-found identity as a tax resister.

The 12 jurors asked U.S. District Judge Legrome D. Davis to reinstruct them on the legal definition of "willful blindness" and whether a belief that the U.S. Tax Code was unconstitutional justified not filing an income tax return.

Davis said the law defines willful blindness as "acting voluntarily and intentionally in violating a known legal duty."

Davis told the jurors that they needed to use their collective experience to decide whether Street truly believed his argument that he stopped filing income tax returns in 2002 because his legislative research convinced him that the income tax was unconstitutional.

"The law protects those who are ignorant of the law or who misunderstand the law but, that is not someone who simply disagrees with the law," Davis said.

Davis added that the jury had to decide whether Street's purported belief was "honestly and genuinely held" or "situational."

After five days of testimony and a morning of closing arguments by the lawyers, the jury deliberated about an hour yesterday and then returned to the federal courthouse in Center City today at 9 a.m.

The 2006 indictment alleges that Street, 68, of Moorestown, a well-known food vendor and former Pennsylvania state legislator, failed to pay taxes on $2 million worth of consulting fees and income not derived from his $30,000-a-year food-vending business between 2000 and 2004. He also did not file a tax return in 2002, 2003 and 2004, the indictment alleges.

In addition to the tax charges against him, Street and codefendant John H. Velardi Sr., 54, of Media, are charged with wire and mail fraud in an alleged 2003 scheme to defraud a Vietnamese businessman of $80,000 by selling him the rights to a $3.2 million airport maintenance subcontract that prosecutors say Street and Velardi knew did not exist.

Prosecution witnesses testified that Street and Velardi wanted to assign the airport subcontract to Thanh Nguyen and his V-Tech Services Inc. to recoup money Street owed PAS.

The government alleged that the rights to the subcontract between PAS and Street's Notlim Inc. were no longer Street's to sell.

In June 2003, airport officials had canceled the Notlim subcontract after Mayor John Street ordered his older brother to withdraw from the deal because it appeared inappropriate. Prosecutors say the former mayor was not involved in his brother's alleged crimes.

Nguyen testified on Feb. 11 that after he paid Street $80,000, the assignment of the subcontract kept getting postponed and that Street and Velardi stopped returning his calls.

Testifying in his own defense on Thursday, Street said he never promised Nguyen that the contract was a certainty and that it was Nguyen's idea to give him a good-faith deposit of cash. Street call Nguyen and other prosecution witnesses liars.

Velardi did not testify, but his lawyer argued that he was just a pawn between Street's scheming and Nguyen's efforts to buy his way into become a city contractor.

[LPC]

Davis added that the jury had to decide whether Street's purported belief was "honestly and genuinely held" or "situational."

That's a very nice way of putting it.

[wserra]

Davis said the law defines willful blindness as "acting voluntarily and intentionally in violating a known legal duty."

I think a reporter may be confused. That's willfulness, not willful blindness.

[Demosthenes]

I think the reporter got it right. From the government's proposed jury instructions:

GOVERNMENT’S REQUEST NO. 56

Willful Blindness

In order to find T. Milton Street, Sr., guilty of aiding and assisting the preparation or
filing of a false or fraudulent tax return, you must find that the government proved beyond a
reasonable doubt that Street knew that his tax return was materially false or fraudulent. When, as
in this case, knowledge of a particular fact or circumstance is an essential part of the offense
charged, the government may prove that T. Milton Street, Sr., knew of that fact or circumstance
if the evidence proves beyond a reasonable doubt that he deliberately closed his eyes to what
would otherwise have been obvious to him.

No one can avoid responsibility for a crime by deliberately ignoring what is obvious.
Thus, you may find that he knew a tax return was materially false or fraudulent based on
evidence which proves that: (1) Mr. Street was aware of a high probability of this fact, and (2)
Mr. Street consciously and deliberately tried to avoid learning about this fact.

You may not find that the defendant Street knew a tax return was materially false or
fraudulent if you find that the defendant actually believed that this fact did not exist. Also, you
may not find that he knew a tax return was materially false or fraudulent if you find only that he
should have known of the fact or that a reasonable person would have known of a high
probability of the fact. It is not enough that T. Milton Street, Sr., may have been stupid or
foolish, or may have acted out of inadvertence or accident. You must find that he was actually
aware of a high probability that a tax return was materially false or fraudulent, deliberately
avoided learning about it, and did not actually believe that it did not exist.
_____________________________
Third Circuit Model Jury Instruction § 5.06.

[LPC]

I think the reporter got it right. From the government's proposed jury instructions:

GOVERNMENT’S REQUEST NO. 56

Willful Blindness

In order to find T. Milton Street, Sr., guilty of aiding and assisting the preparation or
filing of a false or fraudulent tax return, you must find that the government proved beyond a
reasonable doubt that Street knew that his tax return was materially false or fraudulent. When, as
in this case, knowledge of a particular fact or circumstance is an essential part of the offense
charged, the government may prove that T. Milton Street, Sr., knew of that fact or circumstance
if the evidence proves beyond a reasonable doubt that he deliberately closed his eyes to what
would otherwise have been obvious to him.

No one can avoid responsibility for a crime by deliberately ignoring what is obvious.
Thus, you may find that he knew a tax return was materially false or fraudulent based on
evidence which proves that: (1) Mr. Street was aware of a high probability of this fact, and (2)
Mr. Street consciously and deliberately tried to avoid learning about this fact.

You may not find that the defendant Street knew a tax return was materially false or
fraudulent if you find that the defendant actually believed that this fact did not exist. Also, you
may not find that he knew a tax return was materially false or fraudulent if you find only that he
should have known of the fact or that a reasonable person would have known of a high
probability of the fact. It is not enough that T. Milton Street, Sr., may have been stupid or
foolish, or may have acted out of inadvertence or accident. You must find that he was actually
aware of a high probability that a tax return was materially false or fraudulent, deliberately
avoided learning about it, and did not actually believe that it did not exist.
_____________________________
Third Circuit Model Jury Instruction § 5.06.

Sorry, but I think Wes is right, and the reporter got it wrong.

The judge may have instructed the jury on willful blindness, and the above instruction may be an instruction on willful blindness, but what the reporter quoted was the definition of "willfulness."

If anything, the above jury instruction confirms that the reporter was wrong, because the words the reporter quoted don't appear in the jury instruction.

To clarify: "Willfulness" is "acting voluntarily and intentionally in violating a known legal duty." "Willful blindness" goes to the issue of whether the legal duty was "known" to the defendant and not whether the defendant acted "voluntarily and "intentionally" or was "violating" a "legal duty."