A Greendale neurosurgeon has been convicted by a federal jury of tax fraud, but his attorney says the case was an overall victory, considering the jury's acquittal on several counts.
The 50-year-old doctor was initially facing four counts of willfully filing tax returns and another four counts of failing to file reports of foreign bank and financial accounts. Wednesday's verdict convicted him of both charges, but acquitted him on five counts.
According to the indictment against him, he transferred millions of dollars to accounts in India and Bailiwick of Jersey, an island off the coast of France. Prosecutors said he failed to report these accounts in his tax returns from 2006 to 2009, as well as more than $1.2 million in interest income from the India bank account. He was also accused of not paying taxes on the interest income or reporting the foreign accounts to the U.S. Treasury Department.
U.S. citizens are required to report any financial interest in foreign bank accounts, as well as any income earned from those accounts. They also must pay taxes on the income and file any required forms if they have financial interest in a foreign account worth more than $10,000 in a single year. The defendant's attorney said his client's bank failed to issue required documents and that the amount of tax he failed to pay is a small fraction of the taxes he did pay.
Before he was indicted, the surgeon filed amended federal and state tax returns and paid all of the amounts due, along with interest and penalties, according to his attorney. The attorney asked the judge to dismiss all of the charges during the trial, but the judge still hasn't issued a ruling. Dismissal of the charges by the judge would effectively overturn the federal jury's ruling.
Until he's sentenced, the neurosurgeon is free on bond. Each false tax return charge comes with a maximum penalty of three years in prison and a $250 fine. The charge of failing to file foreign bank and financial accounts carries a maximum prison sentence of 10 years and a $500,000 fine.
Ignorance about how income must be reported or taxes that must be paid can quickly land anyone in trouble. If you may have made an accounting mistake that could lead to criminal charges, contacting an attorney with experience in fraud cases may save you from deeper legal trouble.
Source: Milwaukee Journal-Sentinel, "Greendale neurosurgeon convicted of tax fraud," John Diedrich, Aug. 23, 2012
· Our firm handles a wide variety of federal criminal cases. If you'd like to learn more about our practice, visit our Milwaukee fraud defense page.