Iconic mobster Al Capone died in prison after he was convicted of tax evasion. More recently, after the notorious Lufthansa robbery that was immortalized in 1990’s Goodfellas, Jimmy the Gent went to prison not for his alleged role in the robbery but for a point-shaving scandal involving the Boston College basketball team. It could be that crime syndicate figures portrayed by actor Robert De Niro have a certain susceptibility to financial crimes prosecutions, or there could be something else at work.
Tax evasion and other financial crimes in New Jersey are often substitute prosecutions. Traditionally, tax evasion has been easy to prove: there are accurate and timely returns on file, or there are not. “You want to put a murderer in jail for not paying his taxes?” asked a befuddled Elliot Ness in the De Palma version of The Untouchables.
Along with the desire to convict the defendant of something, there’s the bias that many jurors harbor against criminal defendants. All jurors take oaths to consider only the evidence in the case. Some take their oaths very seriously, while others are more inclined to think that “where there is smoke, there is fire.” In other words, if a person is on trial for offense A, the person probably committed offenses B, C and D but was never caught. And now, it’s judgment day.
However, if key tax evasion cases over the last two or three years are any indication, old reliable may not be as reliable anymore.
It took the jury a mere 75 minutes to acquit Raoul Weil of tax evasion charges, after his defense team declined to call any witnesses. The Justice Department worked on the case for six years, yet the message from the jury seemed clear: there wasn’t nearly enough evidence to convict this man beyond any reasonable doubt. While there was ample evidence of fraud and other wrongdoing at UBS, Mr. Weil’s employer at the time, there was scant testimony that Mr. Weil was directly involved in this activity.
The Weil case did not occur in a vacuum. Also in November 2014, former Israeli banker Shokrollah Baravarian was cleared of similar charges by a jury in Los Angeles. Probably not coincidentally, five of the six government witnesses in that trial had made separate deals to avoid prosecution. According to defense attorneys, these witnesses also admitted that they did not seek Dr. Baravarian’s advice when they evaded income taxes. There must be some proof of a conspiracy in a conspiracy prosecution, and it appears that the evidence in this case was a bit flimsy, to say the least.
The beat goes on. Last year, Beanie Baby billionaire Ty Warner pleaded guilty to evading $5.6 million in taxes and could have been incarcerated for up to 57 months. But, during sentencing, Judge Charles F. Kocoras cited Mr. Warner’s “overwhelming…acts of kindness, generosity and benevolence” that “trump[ed] all of the ill-will and misconduct he engaged in,” and sentenced him to probation. The government is appealing that matter.
Effective Defenses in a Tax Evasion Case
All three of these cases have at least one common denominator: the respective legal teams helped their clients put their best foot forward. Mr. Warner was successfully portrayed as a generous entrepreneur who made some mistakes, the 82-year-old Dr. Baravarian was a grandfatherly and non-threatening octogenarian, and Mr. Weil was guilty only by association.
The facts were also very complicated, and even attentive jurors can get lost in the mass of offshore transactions, holding companies and other obfuscations. The prosecutor’s case has a lot of moving parts, and anyone who has ever tried to assemble anything knows that the more moving parts there are, the more likely it is that something will break.
In short, if there are any facts on your side and you have a relatively clean criminal history, you may have the foundation for an outright acquittal or at least a greatly reduced sentence.