A former Minnesota mayor recently resigned from his position amid allegations that he participated in a tax fraud scheme. The supposed criminal tax violation was not for himself, but for two unrelated brothers. These alleged tax crimes were brought as federal charges.
In addition to serving as mayor until his resignation in November, the defendant is also a certified public account. Authorities claim that he helped the owners of multiple health companies prepare and file tax returns that were false. It is believed that the twin owners filed fraudulent claims to Medicaid for which their companies were then reimbursed. The former mayor is also suspected of aiding the men in creating a company that issued payments from those false claims to the owners.
The federal government is allegedly owed $12 million for taxes that were never paid by the two men. The state of Minnesota also claims that it is entitled to unpaid taxes to the tune of over $2 million. Instead of paying these taxes, the men are alleged to have spent the funds on personal expenses and cruises, and this activity is claimed to have been ongoing since 2002.
Typically, federal charges can carry hefty consequences for those convicted of them. Even though the former mayor appears to not have directly benefited from the tax crimes that he has been accused of, he is still facing a conspiracy charge for purportedly helping to hide the brothers' actions. Recent indication has suggested that he may already know how he will plead. In some instances, those facing charges similar to this choose to enter into a plea agreement with the prosecution in exchange for lessened charges and/or fewer consequences. Others find that they are able to garner the most favorable outcome possible by fighting the charges throughout the entirety of a trial court proceeding.
Source: mprnews.org, "Former Stillwater mayor charged with aiding tax fraud", Kia Farhang, Dec. 17, 2014