IFC holdout in my State convicted.

[AFTP]

Delaware courts: Masseuse guilty of tax evasion
Bethany woman owed $117,000

By SEAN O'SULLIVAN • The News Journal • July 30, 2010




WILMINGTON -- A Bethany Beach massage therapist was convicted by a federal jury this week on 12 counts of tax evasion and tax fraud.

According to prosecutors, Anne Marie Connor, 60, also co-owner of a Bethany health food store, evaded paying taxes from at least 2000 to 2004 by hiding her money in "sham" trusts. Assistant U.S. Attorney Edward J. McAndrew said Connor earned more than $527,000 during that period, for which she did not pay $117,000 in federal income taxes.

Prosecutors said Connor set up a series of false trusts that she completely controlled under a scheme set up by an Arizona-based business. All of her income from Bethany Massage and Healing Arts Center and Wholesome Habits Health Food Store was sent to these trusts and she also placed the deed to her Bethany residence in one. But just because funds were in a trust did not mean she could avoid paying taxes on them, McAndrew said.

Prosecutors said operators of the Arizona-based business that set up the scheme -- Innovative Financial Consultants -- were convicted on tax-fraud charges in 2006.

Connor represented herself at trial and McAndrew described her as a "tax protester." Almost all of Connor's motions and letters to the court were under seal and unavailable.

Connor couldn't be reached for comment. She faces up to five years in prison and a fine of up to $250,000, in addition to restitution, when she is sentenced in October by District Judge Sue L. Robinson.

"The verdict handed down today clearly displays the negative consequences of participating in abusive tax schemes," Tony N. Stemen, Acting Special Agent in charge of the Internal Revenue Service Criminal Investigation division, said Thursday.

"The privilege of U.S. citizenship brings with it certain responsibilities, including the obligation to pay taxes owed," U.S. Attorney David C. Weiss said.

Contact Sean O'Sullivan 324-2777 or sosullivan@delawareonline.com.