Nothing’s Certain But….

IRS logoThree tax protesters who told paying clients how to avoid paying the IRS were not exercising their free speech rights, they were engaged in fraud and  conspiracy, according to the 9th U.S. Circuit Court of Appeals.

“Mere advocacy of tax evasion – and nothing more—cannot support convictions for conspiracy or fraud,” according to Judge Milan Smith Jr.  But in this case the defendants did “far more than advocate,” he said.  “They developed a vast enterprise that helped clients hide their income from federal and state tax.”

The appeals court upheld the convictions and sentences for Lynne Meredith, Gayle Bybee and Teresa M. Giordana, all members of a tax protest group, “We the People.” U.S. District Judge Dean Pregerson in Los Angeles sentenced Meredith to 10 years in prison, Bybee to five years and Giordano to three years, four months.

In all, eight defendants were charged and convicted in the case.  One other defendant pled guilty prior to trial.  Two did not appeal and two others had their convictions upheld by the 9th Circuit in 2008.

Smith pointed to claims that defendants instructed their clients how to file false claims with the IRS that they lacked taxable income and to make fraudulent refund requests.

Joining Smith in the opinion were Judges Andrew Kleinfeld and Algenon Marbley, a visiting judge from the Southern District of Ohio.

Case:  U.S. v. Meredith, 05-50452

 

 

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