Two American Tax Consultants officers are guilty of fraud after the firm helped its affluent clients file as "nonresident aliens."
By TIM GRANT
Published March 26, 2004
NORTHDALE - The Northdale Professional Center used to be a magnet for affluent people who wanted to quit paying income taxes, according to the Internal Revenue Service.
A company called American Tax Consultants opened for business there about March 1999 and invited people to attend seminars to learn how the company could change their filing status and make them exempt from federal income taxes.
Business boomed.
Before long, the seminars at 3910 Northdale Blvd. were replaced by nationwide conference calls. IRS investigators say doctors, lawyers, airline pilots and other well-heeled professionals were lining up to become clients.
"Some of these people were educated people who participated in this, who you might have thought would have known better," said Alycyn Culbertson, an IRS public information officer in the St. Petersburg office.
ATC offered to change its clients' tax filing status to "nonresident alien." It made claims that the clients were entitled to refunds of previously paid federal income taxes and that its clients were obligated to pay no additional such taxes.
A top corporate officer of ATC, Lee Scott Roberts, was sentenced last week to four years and three months in federal prison on charges stemming from his scheme to defraud the United States by filing false and fraudulent claims for income tax refunds.
Roberts, 63, of Kodiak, Alaska, was found guilty on one count of conspiracy to file false claims and 11 counts of filing false claims.
Culbertson said Roberts' partner, David A. Johnson of Pinellas County, pleaded guilty to a conspiracy charge in connection with the fraudulent scheme. He was sentenced in January to eight months of house arrest and three years of probation.
Neither Roberts' nor Johnson's attorneys could be reached for comment.
Court records show the government's case against a third defendant, Joey K. Lansing of Brevard County, was dismissed without prejudice. The government can refile a case against Lansing within four years, said Lansing's attorney, Greg Eisenmenger of Melbourne.
Eisenmenger said Lansing was at first an ATC client. He was so impressed by the services ATC provided him and his family that he became an employee.
"Mr. Lansing, like other clients of ATC, believed what he was doing was legal and permissible," Eisenmenger said. "He never engaged in a conspiracy to violate the law. Mr. Lansing was duped into believing what he was doing was legally correct."
Eisenmenger said Roberts had put together a convincing presentation with legal positions in support of what ATC was doing. He said when Lansing received a refund from the IRS, he became more convinced that the federal government recognized ATC's position.
After Lansing was laid off from his job as a technician at Kennedy Space Center, he took a job with ATC. But he got concerned and quit the company after the government subpoenaed him to appear before a grand jury, Eisenmenger said.
Culbertson, the IRS spokeswoman, said the company, which operated for about four years, had between 1,500 and 2,500 clients, based on testimony at Roberts' trial and IRS estimates. The government's case was based on about 400 clients submitting more than 700 false claims totalling $6.8-million.
Federal court records show the men charged clients between $2,200 and $3,100 for the services of preparing and filing the amended or new tax returns. If the client received a refund, ATC kept 40 percent, which in one case added up to $300,000.
The company also hired independent sale agents it called "master representatives" to market the business to new clients.
Clients of ATC will not face criminal prosecution, Culbertson said, but the IRS will pursue civil action against them.
"You can't declare yourself a noncitizen for income tax purposes and yet remain a citizen and have all the benefits of citizenship," Culbertson said.
"These people continued to vote and exercise all their rights as citizens, yet they felt they could denounce their citizenship for income tax purposes only."
She said many similar schemes are detected by the IRS Fraud Detection Centers. Specialized computer programs flag potentially fraudulent patterns as returns flow into IRS Service Centers.
The IRS says its agents frequently deal with arguments from taxpayers who want to be taken out of the tax system because they say they are not U.S. citizens.
Some people argue that they have rejected citizenship in the United States in favor of state citizenship; therefore they are relieved of federal tax obligations. Others argue they are free-born citizens of a particular state and thus have never been U.S. citizens.
The law, however, states that any person born or naturalized in the United States and subject to U.S. jurisdiction is a citizen of both the United States and the state where he or she resides.
The IRS Web site issues a stern warning: "Numerous sellers of bogus schemes have been convicted on criminal tax charges."
