Whether it is coincidence or not, it sure seems that we are seeing many guilty pleas or verdicts when it comes to tax evasion and white collar crime here in 2008. On of the most recent that goes back to a plan in 1994, involved Richard Thronton Burks, III and his wife, Norma Ball Burks.
According to a news release by the US Attorney, Richard and Norma Burks admitted that they conspired with each other to create corporate and trust entities and to transfer money between the entities so they could conceal Richard Burks’s income from the IRS. Richard Burks also pleaded guilty to a separate charge of tax evasion.
The specifics of the Burks actions are as follows as reported in the US Attorney’s news release:
In 1994, Richard Burks directed his employer, Paladin, Inc., a Lexington engineering consulting company, to classify him as a contract employee and to make payments for his services to a company that he and Norma Burks had created. After Paladin would pay his salary to the Burks’ company, Richard Burks further concealed his income from the IRS by transferring money from their company to a trust they controlled. Richard Burks then transferred money from the trust to himself.
In 2000, Richard and Norma Burks purchased Paladin, and they concealed the purchase from the IRS by placing Paladin in the name of another company that they had created. From 1999 through 2001, using their companies and the trust, Richard and Norma Burks concealed Richard Burks’s income of over $480,000 from the IRS. As a result, Richard Burks failed to pay over $84,000 in federal income taxes.
When IRS agents later interviewed Richard Burks, he falsely stated that he only occasionally worked in Paladin’s office, that he did not know when the trust was formed, and that his wife paid his personal expenses with her own funds. During his guilty plea, Richard Burks admitted that he made these false statements to the IRS to conceal his income from Paladin and also to evade the payment of prior unpaid tax assessments of nearly $150,000. Richard Burks agreed that he owes over $233,000 to the IRS in addition to penalties and interest.
Every choice has a consequence. As a white collar crime and business ethics speaker, I speak from first hand experience about the truth about consequences. Reality is – no one escapes the consequences of their choices. While the Burks avoided the “tax man” for a time – they did not avoid the consequences. Not only will they have to pay the back taxes along with penalties and interest, but both face a maximum sentence of 5 years in federal prison. They will be sentenced on June 20, 2008.