Six defendants were convicted Monday after participating in a nationwide tax scheme that enabled 650 wealthy taxpayers to cheat the government out of $60 million.
Michael Vallone of Orland Park, IL, Edward Bartoli of Clearwater, FL, Robert Hopper of Gadsden, AL, Timothy Dunn of Chesterton, IN, William Cover of Naperville, IL, and Michael Dowd of Glenview, IL were convicted of tax-fraud conspiracy and other charges after the 11-week trial in U.S. District Court in Chicago.
According to the Chicago Sun Times, from 1994 to 2003, the six defendants organized, promoted, and sold domestic and foreign/offshore trusts to clients, primarily self-employed individuals, with the effect of diverting income into sham domestic and foreign trusts through a now-defunct company on behalf of clients, hiding hundreds of millions of dollars of income from the government.
The IRS uncovered the operation after engaging in an undercover investigation code-named "Operation Trust Me." More than 30 convictions are still pending in the case with defendants in Florida, Illinois, New York, Ohio, and West Virginia.
The six defendants in the Chicago trial were found guilty of one count each of tax fraud conspiracy, i.e. conspiracy to defraud the United States by impeding the IRs in the collection of tax revenue and conspiracy to aid and assist the preparation and filing of false tax returns on behalf of clients, in addition to being found guilty of other charges. In addition, all six defendants were found guilty of tax fraud regarding their own personal income tax returns.
Sentencing is expected to occur in August or September.