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Avoid These Tax Protest Scams Like You Would Avoid The PlagueOn a daily basis, we learn about various tax protest scams who will only succeed in leading you down a path of destruction. All of them perpetuate over the Internet. They run from the utterly absurd to the completely ridiculous, from the convicted felons to the merely looney. The bottom line is that ALL of the arguments are complete works of fiction and none have any validity whatsoever. What is certainly most amusing is how each of sites tells you why the other supposed tax experts are quacks. Do yourself a huge favor. Please avoid all of these individuals, organizations and their sites as they are all woefully wrong and will run for the hills when the IRS starts taking your possessions or brings criminal charges against you. This list and page will be updated as time permits. Larken Rose
(TaxableIncome.net) Shouldn't Mr. Rose be
thrilled that he might get his day in court so that he can prove to his minions
that his opinions are correct? Nope. He's just another spineless beast who can't
take what he has been asking for. Even Irwin Schiff finds his arguments to be bogus saying "Larken Rose couldn't be more wrong". How would you like to have a slug like Schiff think you're a bozo?! Quatlosers Hall of Shame- Larken Rose Attorney Dan Evans on the Fallacy of the Section 861 scam Lynne Meredith (FreedomMall.com) Lynne moves to the #2 position so Larken Rose can get the top spot. Oh well. If she is convicted she'll regain the #1 position. On Tax Day 2002, she went down, big time. After boasting for years that she didn't file or pay income taxes and that she hadn't even received a call or a letter from the IRS, the anti-tax activist found out that occasionally the Federal government does act. Meredith
is owner of "We The People" and "Sovereignty Pure Trusts", in Sunset Beach,
California. Meredith and six colleagues were
arrested on charges that they bilked victims out of more than $6 million in a
worldwide tax fraud scam. A 35-count grand jury indictment said Meredith and the
others sold bogus "pure trusts", which Meredith said would prevent holders from
ever having to pay income taxes. IRS Arrests Tax Foe in $6 Million Tax Fraud Case Rick Bryan Haraka (Taxgate.com) On November 7, 2002, the Department of Justice filed suit in federal court to stop Richard Haraka, alias Rick Bryan, of Clifton, N.J., from promoting a tax refund scam known as the “Section 861 argument” for the tax code provision it misinterprets. Promoters of the Section 861 argument falsely claim that income from sources in the United States is not subject to federal income tax. Today’s suit, filed in Newark, N.J., is part of a continuing nationwide crackdown against promoters of the Section 861 scam. The government’s complaint alleges that Haraka helped co-found an organization known as “Taxgate,” where he sells materials over the Internet designed to teach customers how to evade federal taxes and unlawfully interfere in the administration of the federal tax laws. According to the complaint, Haraka began promoting the scheme in the mid-1990s with Thurston Bell, who is the subject of a similar suit pending in federal court in Harrisburg, Pa. The complaint also asks the court to order Haraka to provide the Department of Justice with the name of every person to whom he gave, sold or otherwise provided materials relating to the so-called Section 861 argument. U.S. Justice Department Sues New Jersey Man to Stop Promotion of Tax Scam Barrie & Susie Konicov (ThePotentialsUnlimited.com/loophole.htm) Author of "The Great Snow Job" Convicted of Tax Evasion On October 15, 2001, Barrie Leslie Konicov was sentenced to 87 months in prison followed by three years supervised release. In addition, the judge ordered Konicov to file correct tax returns and pay all tax deficiencies, along with paying the cost of prosecution, which totaled $11,311.81. In his press release, United States Attorney Phillip J. Green stated, "At this time, when citizens are uniting, all taxpayers need to pay their fair share. It is these collected taxes that fund the Federal agencies that are currently called upon to serve the safety and security needs of each and everyone. This verdict and sentence should send a strong message to those people who are engaged in similar activities and I urge them to comply with the Federal tax laws." On June 22, 2001, Konicov, of Amado, Arizona, was convicted on one count of conspiracy to defraud the United States by impeding, impairing, obstructing, and defeating the lawful governmental functions of the IRS. He was also convicted on three counts of willfully failing to file Federal income tax returns for the years 1994, 1995, and 1996. Konicov is the founder of De-Taxing America and author of a book entitled, "The Great Snow Job." According to evidence presented in court, Konicov accumulated and deposited more than $3.9 million into a number of bank accounts and sham trusts. The money deposited was obtained through the De-Taxing America program and sham trust packages that were sold throughout the U.S. to over 1,000 people. On October 17, 2001, Susanne Konicov was sentenced to six months home confinement, 200 hours community service, and two years probation. In addition, the judge order her to pay the costs of her court-appointed attorney and a fine of $2,000. On May 3, 2001, Susanne pled guilty to three counts of failure to file tax returns for 1994, 1995, and 1996. Robbie Struckman &
Sharon Kukhahn (IRSCodeBusters.com) They go on to say, "The Bureau of Internal Revenue, and the alleged Internal Revenue Service were not created by Congress. These are not organizations or agencies of the Department of the Treasury or of the federal government They appear to be operated through pure trusts administered by the Secretary of the Treasury ( the Trustee ). The Settler of the trusts and the Beneficiary or Beneficiaries are Unknown. According to the law governing Trusts, the Information does not have to be revealed. Yawn. What a bunch of hooey. While they masquerade as your garden variety tax protesters, what they really do is attempt to get you to send them your money. What a shock! For a fee of $2,495 for a couple filing a married joint return, they will "decode" your IRS Individual Master File. Save the money and keep away from these cretins. Apparently, I struck a nerve or simply hit too close to home. On April 29, 2002, I received not one, not two, not three, but four copies of a letter claiming damage to the sterling reputations of Struckman and Kukhahn. They also claim that we are trying to steal their clients. I would love to have them sue us as we will have the opportunity to expose their scams in a court of law. The letters came from someone named Kenneth Wayne who appears to be posing as an attorney, but I don't believe he has a license to practice law. Nice how these people seem to hang together. More garbage received from these wackos. On June 10, 2002, I once again received four letters similar to those received six weeks ago. It appears that they make up their own courts and then sue you in these phantom courts. These guys should all be tossed in jail and the key permanently thrown away. Thurston Bell
(Tax-gate.com, NITE.org) On November 15, 2001, the United States Justice Department filed suit against Mr. Bell and two others for promotion of what the government contends are tax evasion schemes. According to the New York Times, "The three promoters who were sued yesterday all market versions of what is known as "the 861 position," which contends that the section of the tax code with that number restricts the income tax laws to a small number of Americans, primarily those employed by foreign-owned businesses. Every court that has heard this argument has dismissed it, but its adherents remain undeterred, contending as Mr. Bell did yesterday that the issue was not presented properly, that the cases had procedural flaws or that the judges were incompetent or corrupt." Simply put, Bell's views are a load of garbage. There are numerous ways to debunk his delusions. The following are found on The Tax Protester FAQ by Pennsylvania Attorney Dan Evans. Mr. Bell was once connected with another scam, Taxgate.com, but according to that site, "It so happens that on (sic) foolish individual who in an attempt to steal the web domain of Taxgate.com to use for his own purposes, Thurston Bell registered the domain Tax-Gate (as opposed to Taxgate). The IRS is after Mr. Bell (because of Mr. Bell's repeated 'bonehead' stunts and his getting people into trouble). When the IRS contacts Mr. Bell, they carbon copy their letters to his web site at NITE, to Thurston personally, and to finally, to his other web site named Tax-gate (T. Bell's domain that has nothing to do with Taxgate or Taxgate.com)". The site, PleaseBeware.com states,"Thurston's egomania is so out-of-control that strangers even plead with him via email to "grow up"!! Thurston Bell 's mental disorder dictates upon his awareness that YOU HAD BETTER PAY HIM COMPLETE ALLEGIANCE - ONLY TO HIM or you will be 'cast out' from his following....."According to the previously convicted Irwin Schiff's site, ISchiff.com, "What I discovered is that Mr. Bell has a fundamental misunderstanding concerning the nature and character of the federal income tax, which is obviously causing him to put out a good deal of misinformation on his web site. As of September, 2001, Thurston Bell is under investigation by the IRS for promoting abusive tax shelters. Update: November 7, 2002: According to a press release by the USDOJ, a hearing on the Department’s request for an injunction against Thurston Bell of Hanover, Pa., took place on Nov. 4th in a U.S. district court in Harrisburg. Edward Kotmair (Save-A-Patriot.org) RALEIGH - United States Attorney Janice McKenzie Cole announced that EDWARD L. KOTMAIR, 41, of Westminster, Maryland, was sentenced in federal court here on Thursday, February 3, 2000, for failure to file federal income tax returns. Chief U. S. District Judge Terrence W. Boyle imposed a sentence of 27 months imprisonment and a supervised release term of one year. Following a three-day jury trial in September, 1999, Kotmair was convicted of failing to file federal income tax returns for the years 1990, 1991, and 1992. During those years, he operated his own carpentry business, Commercial Installers, located in Cary, N. C. His company earned income of approximately 1.7 million dollars during the three-year period. Some of Kotmair's income came from the United States Government while he did subcontracting work on the Library of Congress and a Federal Deposit Insurance Corporation building in Washington, D. C. Kotmair was arrested in September, 1998, and has remained in federal custody since that time. During his trial, Kotmair attempted to convince the jury that he did not believe he was required to pay income taxes. The jury rejected his argument and found him guilty on all three counts of the indictment. Kotmair is a member of Save-A-Patriot Fellowship, a tax protest organization located in Westminster, Maryland. The group, which was founded by Kotmair's father, John B. Kotmair, states that U. S. citizens living and working in the United States are not required to pay income taxes. John B. Kotmair (Save-A-Patriot.org) The father of Edward Kotmair; it's clear that the apple doesn't fall too far from the tree. The elder Kotmair was convicted of failure to file federal income tax returns in the early 1980's and served a prison term. Other members of Save-A-Patriot Fellowship, including close associates of Kotmair, also have been convicted of income tax charges and sentenced to prison. According to U. S. Attorney Cole, federal courts and juries have consistently rejected the arguments of "tax protest" organizations, including the Save-A-Patriot Fellowship, and have upheld the income tax laws and their applicability to everyone. Irwin Schiff (ISchiff.com,
PayNoIncomeTax.com) Irwin Schiff also once made the mistake of appearing on television and offered to pay $100,000 to anyone who can identify the sections of the Internal Revenue Code that impose any liability for tax. A man named Richard Newman identified sections 1, 6012, 6151, 6153, 7201, 7202 and 7203 in a telephone call to the television station the following morning and then sued Schiff when he refused to pay the $100,000. The 6th Circuit Court of Appeals agreed that Newman was right about the tax laws and that Schiff's claim was "ridiculous," but ruled for Schiff under principles of contract law, because Newman did not telephone the television station with the correct answer within the time specified in Schiff's offer. Neuman v. Schiff, 778 F.2d 460 (8th Cir. 1985). Students of Mr. Schiff have not fared any better. "At his criminal trial, Mr. Letscher testified that he filed tax returns and paid his taxes until 1980. In 1981, he began listening to and reading materials prepared by Irwin Schiff, a tax protester. Strarting from late 1980, Mr. Letscher attended several seminars hosted by Mr. Schiff. He also subscribed to newsletters prepared by Mr. Schiff. On the basis of information from Mr. Schiff and Mr. Letscher's own research, Mr. Letscher decided not to file any more tax returns because he could not find any law which required him to do so." United States v. Letscher, KTC 1999-648 (U.S.D.C. S.D.N.Y. 1999), (footnotes and citations omitted).Mr. Letscher was convicted of both willful failure to file and tax evasion and was sentenced to 33 months imprisonment. In the civil action cited above, the United States sought to reduce the various tax deficiencies and tax liens against Mr. Letscher to judgments against him and trusts he controlled, and the above description of was part of the court's opinion leading to the conclusion that " Mr. Letscher's pattern of misconduct provides clear and convincing evidence that he intended to evade payment of federal income taxes and justifies the imposition of civil fraud penalties." San Francisco tax attorney Robert Sommers has this to say about Mr. Schiff on his site, The Tax Prophet: In U.S. v Schiff, 85-1 USTC ¶9108 , 751 F2d 116, the second circuit court of appeals affirmed Mr. Schiff’s criminal tax evasion jury conviction. Schiff, the court noted, is the author of "How Anyone Can Stop Paying Income Taxes." On appeal, Schiff, the self-proclaimed leading "untax expert," ditched his argument that the tax system is unconstitutional and contended that he believed, in good faith, he was not required to file tax returns. Implicit in this argument is the recognition that he had an obligation to file tax returns and pay taxes – a 180 degree reversal of what he preaches to the public! The court, however, did not buy Schiff's post-conviction conversion. It easily distinguished between a good faith misunderstanding of the law and Schiff’s vehement and well-documented disagreement with the law. Those who disagree with the law must still obey it. The court stated the good faith defense as follows:
Undeterred by his stint in the slammer, Schiff went back to court. U.S. v Schiff, 89-2 USTC Para 9465, 876 F2d 272 (Sec. Circuit, 1989). This time, he argued that his criminal probation requirement that he file tax returns violated his 5th Amendment rights against self-incrimination. Once again, he lost. The court noted that his argument was a rehash of his basic thesis: he does not have to pay taxes. The court made it clear that Schiff was required to file returns and pay taxes on the income he earned under IRC Sec. 6001, 6151 and 6012. The court dismissed Schiff’s notion that the U.S. tax system is voluntary and no income tax is "legally required."
Shrugging off these defeats, Schiff ventured into court once again. Schiff vs. U.S. 73 AFTR 2d Par 94-517 (U.S. Dist. Ct. 1989). This time in a civil case in which he was hit with civil fraud penalties, he claimed that the IRS could not assess taxes against him. The tax system is unconstitutional; and he sincerely believed that he was not required to pay tax. Predictably, he lost again on all counts. The court made the following findings and conclusions:
In Schiff v CM, T.C. Memo. 1992-183, Mr. Schiff (called "petitioner" in the court decision) once again challenged the U.S. tax system, and the court rejected his frivolous arguments:
Mr. Schiff’s repeated and unsuccessful attempts to challenge the viability of the U.S. tax system demonstrate the futility of the tax protestor movement. The position of the courts regarding the tax protester movement can be summarized as follows:
As I stated earlier, you can always find a Tax Scam Artist to tell you just how rotten and insane the other Tax Scam Artists are. To wit, all you need to do is to read some of the info on Otto Skinner's site. Just another scammer telling you how dumb the other scammers are. Incredible. Below, you can see just what Irwin Schiff thinks of Otto Skinner. As it is clear from Mr. Schiff's site that he hasn't
changed his tune, maybe he'll be a guest of the Federal government yet
again. According to their site, "American Contracting Services (ACS) provides services to workers throughout America with special expertise in the area of non-covered employee contracting. ACS understands the constitutionally limited application of the tax statutes and regulations to the citizen working within the 50 states of the union and is in an excellent position to support the worker's right to choose non-covered employee contracting. Many firms offer conventional employee leasing services (explained below). Almost none, however, offer employment contracting. The unique advantage which ACS enjoys over typical employee leasing and "temping" agencies is, quite simply, that we understand the law." What they are really saying is, "we help you to break the law". Let's start a pool to determine when they guys will begin doing jail time. I'm guessing April, 2004. William Conklin (Anti-IRS.com) William Conklin claims to
have won multiple cases against the IRS. However, Mr. Conklin is truth impaired.
In fact, as noted below, he has lost every case on record. He argues that
"the income tax is voluntary" and that "the Fifth Amendment...is
the best issue that has ever been raised in the Freedom Movement". Mr.
Evans goes on to state the following about Mr. Conklin: A posting on the Netscams
message board states the following about Mr. Conklin: Bill Conklin from Denver, Co. takes a $900 fee up front
to supposedly help people with irs problems, he doesn't know his butt from a
hole in the floor, he is a royal rip- off artist taking advantage of innocent
folks who believe waht (sic) they see on his web site or hear from. Please don't
let this con artist make you his next victim! Larry Becraft is a practicing Alabama attorney. According to Becraft's site, virtually everything is a government conspiracy and the government is the cause of all our ills. His claim to fame is successfully defending Lloyd Long against federal criminal tax charges in a case heard in Tennessee. However, Mr. Becraft conveniently fails to tell you the entire story. Once again, we turn to The Lloyd Long case is one of the great "victories" of tax protesters, meaning that it is absolutely meaningless. Mr. Long was prosecuted for criminal failure to file and was acquitted by a jury, which apparently had a reasonable doubt about whether he had "willfully" failed to file. His acquittal does not "prove" that you are not required to file income tax returns, any more than the acquittal of O.J. Simpson "proves" that it is legal to kill your ex-wife. Mr. Becraft has been sanctioned by the courts for making frivolous arguments "Much of Becraft's reply is also devoted to a discussion of the limitations of federal jurisdiction to United States territories and the District of Columbia and thus the inapplicability of the federal income tax laws to a resident of one of the states...this claim also has no semblance of merit." In re Lowell H. Becraft (United States v. Nelson), 885 F.2d 547 (9th Cir. 1989), (Mr. Becraft, attorney for Mr. Nelson, was fined $2,500 for filing a petition that the court found to be so lacking in merit as to be "frivolous"). The Tax Protester FAQ is full of information on Becraft's failed arguments and also tells us just how Becraft is able to find clients that are willing to take on the IRS:
Quatloos.com
Cyber-Museum of Scams and Frauds Tax Protestor Cases Gallery
shows the utter absurdity of Becraft's arguments and reminds us that Becraft was
sanctioned $2,500 by the Ninth Circuit for his frivolous arguments. The very worst of them all. The Institute for Global Prosperity is the lowest of the lows. They were recently raided by the IRS and their leaders are being sought on criminal charges. Here is what Quatloos.com by Adkisson Consulting LLC has to say about them:
Eddie
Kahn (AmericanRightsLitigator.org) Otto
Skinner (OttoSkinner.com) Drivel, crap, garbage. That's all you really need to know about these idiots. One important point. They try to sell you crap for thousands of dollars. I'll bet you money that Sweet files his tax return like clockwork and dutifully declares every penny of his income while he tells you to become a criminal while he gets rich off your ignorance. Peymon
Mottahedeh (FreedomLaw.org) Austin Gary Cooper, Martha Cooper, Dale Raymond, Douglas Grable, Robin Gamandy, Gary Douglas Holmes, Taking Back America (TBAFoundation.com) Complete nutcases but with a twist. These wackos are entrepreneurs. Conspiracy theories all over the place. These idiots tell you that your tax dollars do not go into the Federal Treasury but rather to "eight primarily foreign, private bankers who share a common goal to establish a monopolistic, global economy under their control." Here's the fun part. If you wish to sell their "product", you make $600 per sale. They also sell pure trusts, which are nothing but pure crap. I have a very strong feeling that these folks will wind up on America's Most Wanted. They are headquartered in Florida, where it seems, many wackos are based. William Tufford (VoluntaryTaxes.com) Yet another of the garden variety tax protesters. Doesn't have any thoughts of his own and chooses to parrot what he picks up from others. Neil McIver (Cjmciver.org) Just another of the garden variety tax protesters. Doesn't have any thoughts of his own and chooses to parrot what he picks up from the other bozos. A conspiracy theorist who claims to have no driver's license or Social Security Number. Gordon Phillips (InformAmerica.com) Edmund Fitzsimmons (TaxFreeUSA.org) Devvy Kidd (Devvy.com) A fairly prolific site, it contains a great deal of information. Unfortunately, it's the same drivel you find elsewhere. Joseph Bannister (FreedomAboveFortune.com) A former IRS Criminal Investigation Special Agent in San Jose, I won't waste the space to put up anything on this clown. The less attention he gets, the better. Dan Meador (Lawresearch-registry.org) One of the oldest tax protesters around, Meador is also an ex-con. On January 10, 1997 Dan Meador was convicted of obstructing justice and illegally communicating with a member of a federal grand jury. On June 5, 1997, a federal judge sentenced Oklahoma common law activist Dan Meador to 16 months in prison, three years supervised release and a $2,000 fine. Bob Schulz, We The People (GiveMeLiberty.org, TaxHonesty.org) Somehow, Mr. Schulz has convinced Maryland Representative Roscoe Bartlett (R-6th) to assist him in scheduling a forum on the legality of the federal income tax system. Mr. Schulz went on a hunger strike to protest the tax system. In a letter from the Congressman to Bob Schulz, Bartlett states "We have re-scheduled the forum (symposium) for February 27 and 28 in the Science and Technology Committee Hearing Room in the Rayburn House Office Building beginning at 9:00 a.m. each day. A letter of support and confirmation signed by myself and other members of Congress has been drafted, circulated, and will be sent to officials at the Department of Justice, Treasury and the IRS, informing them of the dates and times and requiring their attendance. I will personally chair the event and have invited other members of Congress to attend and sit on the panel." I will do everything I can to be invited to speak before that panel. Site owner unknown (TreasuryTaxSecrets.com) Thomas Scambos (Tax-Freedom.com) Al Thompson Al Thompson is the owner of Cencal Aviation Products of Shasta Lake, CA. Mr. Thompson believes that he is not required to withhold taxes from his employees wages and allowed the New York Times access to a meeting with his company's employees to discuss his ideas. The New York Times wrote about Mr. Thompson on November 19, 2000. Nick Jesson (TaxDefenseFund.org, NickJesson.org) Nick Jesson is the owner of No Time Delay Electronics of Huntington Beach, CA. Mr. Jesson believes that he is not required to withhold taxes from his employees wages and flaunts that supposed knowledge. His business was raided by the California Franchise Tax Board on May 2, 2001. Nick was also a candidate for Governor of California. BTW, I didn't vote for him. Jack Cohen (TaxAx.org) Just another of the crowd that believes employers can't and must not withhold taxes from their employees. Those advocating this position are now feeling serious heat from the IRS.Here's the latest from this reckless individual that was
posted on the misc.taxes newsgroup. My name is Jack Cohen. I've been wrestling with forced wage withholding, liens, levies, and the like for many years. I've read the entire series of tax laws enacted since 1909, and much more. I have evidence found in official government publications that the IRS is not authorized to send notices of levy to any but government instrumentalities and large employers who have written agreements with the IRS to accept service of such levies. Within the next few weeks, I will be making a very convincing group of documents that will enable anyone who receives a notice of levy from an IRS employee to file charges against the idiot who signed it. Look for it soon on my web site at Taxax.org. You may also find some of my free articles interesting, such as my "Layman's Guide to Withholding". Bill Benson (TheLawThatNeverWas.com) Jim Paulson (YourTaxFreedom.com)
We also suggest that you visit these excellent sites for good, accurate, definitive information on the Tax Protest movement and their fallacious arguments. Recent Cases (These Guys are Going to Jail) Tax Protest Movement, Extremism in America Internal Revenue Service Criminal Investigation Joseph G. Adams' Tax Protester Hall of Fame
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