Apr 16th 2013
By Teresa Ambord
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NBA agent LaPoe Smith Jr. of San Antonio is fighting one legal battle after another, though to some extent, the battles are connected. Smith has represented NBA stars that include Antoine Walker, Bo Outlaw, and Penny Hardaway as well as pro athletes from other sports.
Unfortunately for Smith, one of those clients tipped the IRS about some of his seemingly shady activities – like failing to report a large pot of money. If proven true, those activities could put Smith behind bars for a long time to come. Besides charges of tax evasion, several other allegations have kept the authorities sniffing around Smith's door for the last few years, including money laundering, embezzlement, and drug-related crimes.
The Ax Falls
On April 3, 2013, a San Antonio grand jury indicted Smith on charges that in 2005, he had $2 million of income that he didn't report or pay taxes on. The grand jury indictment also states that Smith gave his tax preparer false information that led to the filing of a tax return for 2005 showing income of only $27,256.
In addition to his 2005 reported income, the court document goes on to separately list Smith's reported income for 2006 through 2009:
- $21,939 in 2006
- $44,765 in 2007
- $21,498 in 2008
- $59,759 in 2009
After the amount for each year, the indictment states that Smith "well knew, he and his wife had total income well in excess of that amount."
Where did the $2 million of unreported money come from? Smith's client, Antoine Walker, accuses Smith of embezzling some of it from him and possibly from other clients. And $600,000 came from gambling winnings that Smith failed to report, says Walker. The grand jury charges say that Smith committed "affirmative acts of evasion" by transferring $2 million to an annuity account without reporting it as income or paying tax on it.
Feds Pay a Visit
This isn't Smith's first brush with the law. Going back a couple of years, in 2011, federal authorities attempted to seize five parcels of property in California owned by Smith, after they claimed to have spotted marijuana fields during a flyover inspection.
The property, said authorities, was purchased for $161,000 with a series of money orders, bank checks, and cashier's checks, all for under $10,000. Because of the unusual payment method, authorities said the purchase had the "hallmarks of money laundering."
Smith defended himself by saying he bought the property sight unseen for someone else, who didn't have the means. No drugs were actually seized on the land.
Authorities recently allowed Smith to sell the property for $160, 000, though the money is being held in an asset account pending Smith's trial.
Smith filed a response, denying all the charges and accuses the government of tarnishing his name and reputation. The official allegations against Smith don't include money laundering or drug crimes.
If convicted on all counts, Smith faces up to five years in federal prison for tax evasion and up to three years per count for not filing false tax returns for five years.