Saladino, Fuselier, et al.

[LPC]

Some of the usual suspects have been rounded up again.

UNITED STATES ATTORNEY'S OFFICE
District of Oregon

PRESS ROOM

January 10, 2008

INDICTMENT CHARGING FOUR IN AN INCOME TAX CONSPIRACY CASE RESULTS IN ARRESTS IN FOUR STATES

Abusive Tax Programs Allegedly Sold Across the United States

Portland, Ore. - Joseph Oquendo Saladino, Richard Allen Fuselier, Marcel Roy Bendshadler and Michael Sean Mungovan (A.K.A. “Cajun Mike”) were arrested by special agents of the Internal Revenue Service – Criminal Investigation on January 10, 2008 in Portland, Oregon; Boise, Idaho; Sterling Virginia; and Lafayette, Louisiana. A fifth defendant has not yet been arrested. All five were charged with a single count of Conspiracy to Defraud the United States in a sealed indictment returned by a Federal Grand Jury in Portland, Oregon on December 18, 2007. The indictment was unsealed on January 9, 2008.

The indictment alleges that the five individuals conspired to defraud the United States by interfering with the Internal Revenue Service’s ability to accurately assess and calculate income taxes. Programs designed to assist people in evading the assessment or collection of federal income taxes were allegedly marketed and sold by the five defendants to people across the United States. For example, the indictment alleges that more than 1000 tax returns were filed by or on behalf of individuals utilizing the tax evasion program marketed by the defendants. The indictment states that the claimed tax loss from false income tax returns filed as a result of these abusive tax programs exceeded $7.5 million.

According to the indictment, beginning around January 2000, Saladino allegedly founded Freedom & Privacy Committee (FPC) while residing in Portland Oregon. FPC allegedly sold several abusive tax programs from about May 2001 through at least January 2005, which had no legitimate purpose and were designed solely to assist people evade the assessment or collection of federal income taxes. Mungovan was the National Sales Director for FPC from about May 2002 through at least November 2005. Bendshadler was an FPC Independent Representative and sold FPC’s products to individuals from about May 2001 through at least November 2005. As also alleged in the indictment, around February 2001, Fuselier founded Compensation Consultants, Inc. (CC) and prepared, and caused to be prepared, fraudulent federal income tax returns for CC’s clients. CC was formed to assist people in evading the assessment or collection of federal income taxes. The fifth defendant, who has not yet been arrested, allegedly prepared, and caused to be prepared, hundreds of fraudulent federal income tax returns for CC’s clients, from about February 2002 through at least May 2004.

An indictment itself is not evidence that the defendants committed the crime charged. The defendants are presumed entirely innocent until and unless the Government meets its burden of proving guilt beyond a reasonable doubt in a court of law.

The investigation was conducted by the Internal Revenue Service - Criminal Investigation, and is being prosecuted by Assistant United States Attorneys Allan M. Garten and Craig J. Gabriel, along with Department of Justice, Tax Division Trial Attorney Lori A. Hendrickson.

Questions should be directed to Assistant United States Attorney Allan M. Garten at (503) 727-1043.

[webhick]

Richard Allen Fuselier

Isn't he also on LH? I checked the username and there's a strange gap of activity between the 5th and the 11th.

[Dezcad]

Richard Allen Fuselier

Isn't he also on LH? I checked the username and there's a strange gap of activity between the 5th and the 11th.

AFAIR, he actually got banned from LH.

[Demosthenes]

The indictment:

http://www.cheatingfrenzy.com/saladino1.pdf

[ASITStands]

AFAIR, he actually got banned from LH.

He was banned from the "old" forum. And, of course, the old forum has disappeared.

He encouraged LoserHeads to litigate their issue in court under dubious theories. He had a twisted view of how you could bring a case before the courts. I think we talked about it somewhere.

All the while he was under permanent injunction in WDLA.

There were several petitions for writ of mandamus, but I haven't looked at the outcome lately.

Thanks for the copy of the indictment, Demo.

[LPC]

Richard Allen Fuselier

Isn't he also on LH?

Thanks. I knew the name looked familiar and I couldn't think where I had seen it. (Unlike Demo, I do not have everyone card cataloged.)

[Famspear]

Is this the guy?

Richard Fuselier v. United States

U.S. Ct. of Federal Claims, 63 FedCl 8, 2005-1 U.S. Tax Cas. (CCH) ¶50,424 (November 18, 2004).

Richard Fuselier, pro se. David Gustafason, Department of Justice, for defendant.

OPINION AND ORDER 1

BLOCK, Judge: Plaintiff, Richard Fuselier, has demonstrated a propensity to beat dead horses in more ways than one. First, in his numerous filings in this case, 2 he has trotted out again and again a familiar set of specious arguments. Second, plaintiff has filed multiple separate cases in this court that are little more than re-runs of the same specious arguments. See below. Third, plaintiff apparently is part of an increasing number of misguided individuals who are unable to restrain themselves from making the same specious arguments. See below.

The defendant has opposed each of plaintiff's filings and has filed a motion to dismiss the complaint for lack of subject matter jurisdiction. The court dismisses plaintiff's complaint (and all other items that might be construed as claims for relief) for lack of subject matter jurisdiction.

Plaintiff's claims are not easy to interpret. However, giving his many filings the liberal reading afforded to pro se plaintiffs, Forshey v. Principi, 284 F.3d 1335, 1357-58 (Fed. Cir. 2002) ( en banc), it seems that plaintiff has asked this court to review tax deficiency cases, enjoin IRS collection activities, rule that IRS collection activities are res judicata, and generally review administrative records. By using the words "due process," plaintiff may have raised a due process claim. Plaintiff has presented the argument that wages are not subject to taxation. Plaintiff has also claimed that a fiduciary duty or the joinder rule ( see RCFC 18) permit him to represent his "clients" before this court even though he is not an attorney.

The Court of Federal Claims "has jurisdiction only where and to the extent that the government has waived its sovereign immunity, and any waiver of sovereign immunity cannot be implied but must be unequivocally expressed." Ledford v. United States, 297 F.3d 1378, 1381 (2002) (punctuation omitted). To survive a motion to dismiss for lack of subject matter jurisdiction ( see RCFC 12(b)(1)), the plaintiff must point to a statute that specifically confers power upon this court to grant the relief he has requested. Id.

Plaintiff has failed to establish that this court has jurisdiction over any of his claims. He has failed to point to a statute granting this court authority to review deficiency cases. This is not surprising, because the United States Tax Court, and not this court, has jurisdiction over deficiency cases. See 26 U.S.C. §6213(a). The Court of Federal Claims does, however, have jurisdiction over tax refund cases. See 28 U.S.C. §§1346(a)(1), 1491. But plaintiff does not allege that he has paid taxes or that he seeks a refund. On the contrary, the pleadings specifically refer to a notice of deficiency. Thus, this court lacks jurisdiction over plaintiff's tax deficiency claim. See Ledford, 297 F.3d at 1382.

Plaintiff has failed to point to a statute granting this court authority to stay IRS collection activities. The plaintiff cited several statutes and regulations, 3 but none of these come even close to conferring jurisdiction on this court. On the contrary, 26 U.S.C. §7421 prohibits suits "for the purpose of restraining the assessment or collection of any tax ... in any court by any person." It is true that §7421 lists statutes that provide exceptions to its general rule, but none of these apply in this case. Plaintiff has also failed to point to a statute granting this court authority to conduct a general review of IRS administrative records.

This court clearly has no jurisdiction over any due process claim that plaintiff may have raised. See, e.g., Murray v. United States, 817 F.2d 1580, 1582-83 (Fed. Cir. 1987); Medina Constr., Ltd. v. United States, 43 Fed.Cl. 537, 558 (1999). Plaintiff's nonsensical invocation of res judicata (generally a defense preventing either litigation of issues that could have been but were not raised in prior litigation or relitigation of issues already decided) does not trigger this court's jurisdiction. Likewise, plaintiff's claim that wages are not subject to taxation has been so soundly rejected that plaintiff has risked the imposition of sanctions by raising this argument at all. See, e.g., Casper v. Comm'r, 805 F.2d 902, 906 (10th Cir. 1986) ("Merely raising the argument that value received for labor does not constitute taxable income, but rather constitutes a nontaxable exchange of property, justifies the imposition of sanctions."); Connor v. Comm'r, 770 F.2d 17, 20 (2d Cir. 1985) ("Wages are income. The argument that they are not has been rejected so frequently that the very raising of it justifies the imposition of sanctions."); Lovell v. United States, 755 F.2d 517, 519-20 (7th Cir. 1984) (per curiam).

Finally, plaintiff, a non-attorney, cannot pursue the claims of others or represent others before this court. Under RCFC 83.1(a), only "attorneys who are members of the bar of this court and who comply with these rules" are permitted to "enter an appearance, file pleadings, and practice in this court." RCFC 83.1(c)(8) provides that "[a]n individual may represent oneself or a member of one's immediate family as a party before the court. Any other party, however, must be represented by an attorney who is admitted to practice in this court."

Neither plaintiff's misreading of the joinder rule (see RCFC 18) nor his fiduciary duty argument can save his failure to comply with RCFC 83.1 RCFC 18 permits a party properly before this court to "join, either as independent or as alternate claims, as many claims as the party has against an opposing party." Id. Likewise, a "third party may join, to the extent permitted by law, as many claims as the party has against the opposing party." Id. Absolutely nothing in this language comes even close to permitting the unauthorized practice of law. Likewise, certainly no fiduciary duty, "[a] duty of utmost good faith, trust, confidence, and candor ... a duty to act with the highest degree of honesty and loyalty toward another person and in the best interests of the other person" (BLACK'S LAW DICTIONARY 523 (7th Ed. 1999)), permits plaintiff to engage in the unauthorized practice of law.

Unfortunately, plaintiff has attempted to engage in the unauthorized practice of law before this court on multiple prior occasions. Naming himself as plaintiff while pursuing the claims of other parties, plaintiff has filed the following cases in this court (all dismissed): Fuselier v. United States, Fed. Cl. No. 03-1750T; Fuselier v. United States, Fed.Cl. No. 04-0008T; Fuselier v. United States, Fed.Cl. No. 03-1988. Similarly, plaintiff has filed at least seven cases in which he apparently claims to serve as the "attorney-in-fact" for his "clients" (all dismissed): Barnwell v. United States, Fed.Cl. No. 04-555T; Holt v. United States, Fed.Cl. No. 04-485T; Martinez v. United States, Fed.Cl. No. 04-576T; Looney v. United States, Fed.Cl. No. 04-605T; Vories v. United States, Fed. Cl. No. 04-606T; Wallace v. United States, Fed.Cl. No. 04-793T; Brown v. United States, Fed.Cl. No. 04-906T. Incredibly, shortly before this Opinion and Order was issued, it seems that plaintiff filed ten more cases in which he attempted to represent his so-called clients before this court: Looney v. United States, Fed.Cl. No. 04-1529T; Fischer v. United States, Fed.Cl. No. 04-1535T; Southworth v. United States, Fed.Cl. No. 04-1538T; Southworth v. United States, Fed.Cl. No. 04-1539T; Mentler v. United States, Fed.Cl. No. 04-1546T; Caudle v. United States, Fed.Cl. No. 04-1547T; Powell v. United States, Fed.Cl. No. 04-1548T; Abate v. United States, Fed.Cl. No. 04-1549T; Wallace v. United States, Fed.Cl. No. 04-1550T; Stolsky v. United States, Fed.Cl. No. 04-1551T. Furthermore, it appears that individuals associated with plaintiff have filed numerous other similar suits in this court. For example, Richard Ortt, an apparent associate of plaintiff, has filed seven cases in this court attempting to press tax claims of others (all dismissed): Ortt v. United States, Fed.Cl. No. 03-1625T; Ortt v. United States, Fed.Cl. No. 03-1755T; Ortt v. United States, Fed.Cl. No. 03-1759T; Ortt v. United States, Fed.Cl. No. 03-1818T; Ortt v. United States, Fed.Cl. No. 03-1868T; Ortt v. United States, Fed.Cl. No. 03-1945T; Ortt v. United States, Fed.Cl. No. 03-2514T.

The court notes that on July 12, 2004, defendant petitioned this court to impose RCFC 11 sanctions on plaintiff on the basis of these repetitive improper filings. Plaintiff has not responded to the defendant's motion for sanctions. While the court will not impose sanctions at this time, plaintiff should take heed that his actions are sanctionable. Indeed, plaintiff's persistent repetition of frivolous arguments in multiple cases while attempting to engage in unauthorized law practice only compounds the likelihood that serious sanctions will be imposed.

Accordingly, to ensure compliance with its rules, the court ORDERS plaintiff to refrain from filing or assisting in the filing of any and all pro se actions in this court without prior approval of a Judge of this court and DIRECTS the Clerk of the Court to reject any filings that conflict with this order. Concerned about plaintiff's attempts to engage in the unauthorized practice of law, the court therefore DIRECTS the Clerk of the Court to send a copy of this order to the Louisiana Attorney Disciplinary Board for action. For the reasons discussed above, the court DENIES defendant's motion for sanctions, GRANTS defendant's motion to dismiss, and DISMISSES plaintiff's complaint. The court ORDERS the Clerk to close the case.

NO COSTS.

1 This Opinion and Order, issued on October 19, 2004, was initially unpublished. On October 29, 2004, the Defendant filed a Motion to Publish this Opinion and Order, which the court granted on November 10, 2004.

2 On June 3, 2004, plaintiff filed his "Complaint for Writ of Execution and Motion for an Automatic Stay." In this document, plaintiff petitioned this court to review an Internal Revenue Service ( "IRS") Notice of Deficiency and to stay associated IRS collection activities. This "Complaint" refers to due process and incorporates an attached document titled "Pleading Special Matters #1," which reveals that plaintiff is pressing this tax claim on behalf of an individual named Charles Looney. In this "Pleading Special Matters # 1," plaintiff referred to himself as Looney's "attorney in fact." On June 10, 2004, plaintiff filed a "Motion for Joinder," attached to which were multiple additional "Pleading Special Matters," through which plaintiff has attempted to press the tax claims of several other individuals.

On June 29, 2004, plaintiff filed a "Motion for Writ of Execution on Joinder." Through this document, plaintiff petitioned this court to give effect to orders of a phony court, "the Common Law Court of the United States of America." See Ledford v. United States, 297 F.3d 1378, 1382 (Fed. Cir. 2002) ( "The so-called Common Law Court of the United States ... is not a recognized court of law of any jurisdiction, and its 'judgments' are not persuasive, much less binding authority.").

On August 2, 2004, this court issued an Order to Show Cause why it should not dismiss this matter for failure to prosecute pursuant to Rules of the United States Court of Federal Claims ( "RCFC") 41(b). On August 26, 2004, plaintiff filed his "Response to Order to Show Cause and Motion to Review the Administrative Record." In this document, plaintiff attempted to distinguish the "United States" from the "United States of America" in conjunction with a claim that the Department of Justice attorney handling this matter does not truly represent the defendant. Plaintiff's "Response to Order to Show Cause and Motion to Review the Administrative Record" also requested review of the administrative record. An attached document titled "Brief in Support of Motion to Review the Administrative Record," reveals that by requesting such review, plaintiff has petitioned the court either to review so-called "composite returns" or to order the production of administrative documents. In yet another document filed on August 26, 2004 titled "Motion to Amend Pleading," plaintiff sought to amend the complaint by adding an argument that a fiduciary relationship between plaintiff and his clients permits him to pursue their tax claims. Two documents accompanied this "Motion" --an "Amended Complaint for Review of Administrative Determinations of Tax Liability and Motion for Stay," and an "Amended Statement of Facts." The "Amended Complaint" includes plaintiff's fiduciary duty argument, restates his request for review of the administrative record related to so-called composite tax returns and a stay of IRS collection activities, and raises an often-rejected argument that wages are somehow not subject to taxation. The "Amended Statement of Facts" refers to several documents not before this court and asserts that these documents will establish certain facts or lead to certain legal conclusions. Still another document filed August 26, 2004, a "Brief in Support of Automatic Stay of Collection Proceedings and Responsive Pleading by United States," discusses plaintiff's claim that this court should stay IRS collection activities. Citing several statutes and regulations (5 U.S.C. §703, 26 U.S.C. §§6212(a) and 6511(d)(2)(B)(iii), and 26 C.F.R. §§601.103(c) and 601.106(a)(ii)), this "Brief" claims that this court should stay the matter or rule that it is "res judicata" on the basis that the IRS Appeals Office has jurisdiction over it.

On September 13, 2004, plaintiff filed his "Second Motion to Review Administrative Records," through which he petitioned the court either to review documents of an undetermined nature or to order the production of documents. An attachment, plaintiff's "Statement of Facts in Support of Second Motion" refers to documents not before this court and asserts that they will establish certain facts or lead to certain legal conclusions. Finally, also on September 13, 2004, plaintiff filed a document titled "Motion for Automatic Stay of Collection Proceedings," in which he again claimed that IRS collection actions should be stayed. In this document, plaintiff repeated his claims about an exception to the Anti-Injunction Act (once again citing 5 U.S.C. §703,26 U.S.C. §6212, and 26 C.F.R. §601.103) and added an argument that the matter has been referred for criminal prosecution.

3 See supra footnote 1.

(bolding added)

[Cpt Banjo]

It appears Mr. Fuselier has a habit of shooting off his mouth...

[Judge Roy Bean]

"Looney v. United States, Fed.Cl. No. 04-1529T"

That pretty much sums it up.

[Dezcad]

AFAIR, he actually got banned from LH.

He was banned from the "old" forum. And, of course, the old forum has disappeared.

He encouraged LoserHeads to litigate their issue in court under dubious theories. He had a twisted view of how you could bring a case before the courts. I think we talked about it somewhere.

He was discussed in this thread with a link to complaints he had filed.

[ASITStands]

He was discussed in this thread with a link to complaints he had filed.

Thanks. Abrogate citizenship and litigate a stay on collection. I had forgotten those arguments.

[Imalawman]

Subject regarding new name has been moved to Ranting and Raving.

[Weathervane]

Joseph Oquendo Saladino, Richard Allen Fuselier, Marcel Roy Bendshadler and Michael Sean Mungovan (A.K.A. “Cajun Mike”) were arrested by special agents of the Internal Revenue Service – Criminal Investigation

I never knew IRS-CID had arresting powers. When did they get their Jackboots?

[Famspear]

tommygun wrote:

I never knew IRS-CID had arresting powers. When did they get their Jackboots?

Special Agents of the Criminal Investigation division of the Internal Revenue Service, U.S. Department of the Treasury, as law enforcement officials carrying badges and firearms, with the power of arrest, have been around for a long, long, time -- I assume long before most of us here were born. I'll try to check on this, as far as a date.

[Famspear]

OK, according to this:


http://books.google.com/books?id=qLyvGK ... XmpJFF9MTI

it would appear that the Special Agent (in the Special Intelligence Unit of the Bureau of Internal Revenue of the Department of the Treasury) has been around since about the year 1919. Not clear whether these folks carried firearms or could make arrests, but I suspect that this would be a reasonable assumption.

[Judge Roy Bean]

...I never knew IRS-CID had arresting powers. When did they get their Jackboots?

Ness was a Treasury Agent.

[Famspear]

Here's some quick and dirty research.

Section 7608 of the Internal Revenue Code (AUTHORITY OF INTERNAL REVENUE ENFORCEMENT OFFICERS) provides (in part):

[ . . . ](b) ENFORCEMENT OF LAWS RELATING TO INTERNAL REVENUE OTHER THAN SUBTITLE E. --

(1) Any criminal investigator of the Intelligence Division of the Internal Revenue Service whom the Secretary charges with the duty of enforcing any of the criminal provisions of the internal revenue laws, any other criminal provisions of law relating to internal revenue for the enforcement of which the Secretary is responsible, or any other law for which the Secretary has delegated investigatory authority to the Internal Revenue Service, is, in the performance of his duties, authorized to perform the functions described in paragraph (2).

(2) The functions authorized under this subsection to be performed by an officer referred to in paragraph (1) are --

(A) to execute and serve search warrants and arrest warrants, and serve subpoenas and summonses issued under authority of the United States;

(B) to make arrests without warrant for any offense against the United States relating to the internal revenue laws committed in his presence, or for any felony cognizable under such laws if he has reasonable grounds to believe that the person to be arrested has committed or is committing any such felony; and

(C) to make seizures of property subject to forfeiture under the internal revenue laws.

(bolding added).

Now, here is an excerpt from the decision in the case of Leveto v. Lapina:

At the outset, plaintiffs argue that special agent Lapina lacked authority to present the application and affidavit of probable cause, and thus, the searches and seizures were void ab initio. [ . . . ] These allegations border on the frivolous. Federal Rule of Criminal Procedure 41(a) states that a federal magistrate may issue a search warrant "pon the request of a federal law enforcement officer or an attorney for the government." A "federal law enforcement officer" is any government agent who is engaged in the enforcement of the criminal laws and is within the category of officers authorized by the Attorney General to request the issuance of a search warrant. [ . . . ] There is no doubt that special agent Lapina's primary responsibilities include the investigation of alleged criminal violations under federal tax law, and that the Internal Revenue Code grants him the authority to execute search warrants and to seize property. 26 U.S.C. §7608(b)(2)(A).
Plaintiffs are under the mistaken impression that because §7608 of the Internal Revenue Code uses the term "Intelligence Division," rather than Criminal Investigation Division, special agent Lapina lacked authority to execute the search warrants. "Intelligence Division" is the former name of the Criminal Investigation Division. See U.S. v. Amerada Hess Corp., 619 F.2d 980, 982 (3d Cir. 1980); U.S. v. Garden State Nat'l Bank, 607 F.2d 61, 65 n. 3 (3d Cir. 1979); U.S. v. Morgan, 761 F.2d 1009, 1011 (4th Cir. 1985); U.S. v. Silvestain, 668 F.2d 1161, 1163 (10th Cir. 1982); U.S. v. Miller, 660 F.2d 563, 565 n. 2 (5th Cir. 1981); U.S. v. Jones, 630 F.2d 1073, 1081 n. 12 (5th Cir. 1980); U.S. v. Equitable Trust Co., 611 F.2d 492, 495 n. 1 (4th Cir. 1979).

--from Leveto v. Lapina, 2000-1 U.S. Tax Cas. (CCH) paragar. 50,278 (W.D. Pa. 2000), aff'd, 258 F.3d 156, 2001-2 U.S. Tax. Cas. (CCH) paragr. 50,536 (3d Cir. 2001).

By the way, subsection (a) of section 7608, relating to enforcement under Subtitle E of the Code, specifically grants, to agents enforcing Subtitle E, the power to carry firearms. I suspect that the IRS grants its Special Agents the powers to enforce the laws under the entire Code, not just under Subtitle E. Therefore, I would think that Special Agents are generally authorized to carry firearms, regardless of which Subtitle a particular Special Agent happens to be enforcing at any given moment. I could be wrong, though. Does anyone know whether the IRS distinguishes between "Subtitle E" special agents and "all other" special agents?

[Nikki]

Perhaps someone could get in touch with and ask Joe Banister?

[Famspear]

From the Internal Revenue Manual:

By commissions given each officer of Criminal Investigation, the Commissioner designates such individuals as having the authority to perform all duties conferred upon such officers, under all laws and regulations administered by the IRS, including the authority to investigate, require, and receive information related to the aforementioned laws and regulations. Delegation Order No. 158 authorizes the Special Agent in Charge (SAC) to investigate violations of 18 USC §1956 and 18 USC §1957 where the underlying conduct is subject to investigation under Title 26 or the Bank Secrecy Act, i.e., 31 USC §5311 et seq. (other than violations of 31 USC §5316). See IRM 1.2.2, Delegations of Authority, Delegation Order 158.

--IRM 9.1.2.2, item 4, "General Authority to Enforce Internal Revenue Laws and Related Statutes" (Nov. 10, 2004), Internal Revenue Service, U.S. Department of the Treasury (bolding added).