Couple guilty of two kinds of evasion
- Geoff Pursinger
- The Times - News
Tony and Micaela Dutson failed to surrender after tax evasion scheme
A couple who ran a tax evasion scheme for years out of their Tigard law office and later fled the state could spend the next 20 years in federal prison.
On Thursday, a U.S. District Court in Portland found Micaela and Tony Dutson guilty of failing to surrender themselves to police for their sentences.
The Dutsons were previously convicted and sentenced to 10 years in prison for running a multi-million dollar tax evasion scheme out of Micaela Dutson's Tigard law office, and had been ordered to turn themselves over to the Federal Bureau of Prisons on May 23.
Prosecutors say the two cut off their electronic monitoring bracelets while staying with family in Elgin, Ore. and fled to Phoenix, Ariz., where they were arrested in June.
The couple are scheduled to be sentenced Dec. 8, and could face an additional 10 years in prison, as well as a $250,000 fine.
Trouble started in 2008
When they were first convicted earlier this year, prosecutors said the Dutsons used elaborate schemes to shield assets and avoid paying taxes - and accrued about $7 million over 10 years.
Investigators began looking into the Dutsons in 2008 after the IRS discovered that many of Micaela Dutson's clients were being audited for failing to file tax returns, despite a prior history of paying their taxes.
During their trial, nine of Dutson's former clients testified that they followed the Dutson's advice, to their detriment.
The Dutsons sold clients on the belief that they could deposit income and assets into a system of 'trust' accounts, which were wrapped in secrecy requirements.
The intent of those trust accounts was to shield their clients from paying federal taxes, prosecutors said.
In an attempt to deceive the IRS, the Dutsons set up fake bank accounts and dummy corporations making it difficult to trace the clients' income and assets. The Dutsons continued to sell the trust packages for years, ignoring several warnings from the IRS.
After the Dutson's 150 clients were told that the trusts were shams, prosecutors said the Dutsons harassed and intimidated the IRS employees investigating them, telling their clients to use the trusts to pay off the Dustons' commercial debts, including mortgages and court-ordered obligations.
Together the Dutsons and their clients presented more then $44 million worth of bogus financial instruments. The couple also told clients to file frivolous lawsuits against IRS employees, prosecutors said.
Meanwhile, the Dutsons charged their clients $3,500 to help the clients file the lawsuits.
Then, when the Department of Justice filed for a permanent injunction to shut the business down, the Dutsons filed a $1 trillion lien against IRS employees who had attempted to audit or investigate them, as well as Department of Justice attorneys who filed for the injunction.
When the lien was ruled to be without legal basis, the Dutsons prepared a smaller lien for a client against then Secretary of the Treasury John Snow, for $108 million.
The Dutsons also filed about 30 bogus tax returns, in an attempt to claim more than $185 million in fraudulent refunds from the IRS, prosecutors said.