Tax Fraud — Prison Sentences of 1 Year or More, July 2008 Number Latest Month 23 Percent Change from previous month -14.8 Percent Change from 1 year ago -3.8 Percent Change from 5 years ago 45.2 Table 1: Criminal Tax Fraud Prison Sentences of 1 Year or More The latest available data from the Justice Department show that during July 2008 the government reported 23 new tax fraud prison sentences of 1 year or more. According to the case-by-case information analyzed by the Transactional Records Access Clearinghouse (TRAC), this number is down 14.8 percent over the previous month. The comparisons of the number of defendants convicted are based on case-by-case information obtained by TRAC under the Freedom of Information Act from the Executive Office for United States Attorneys. (See Table 1) About These Reports For many years, Tax Analysts and the Transactional Records Access Clearinghouse (TRAC) have vigorously exercised their rights under the Freedom of Information Act to obtain authoritative information from the IRS. Although the two public interest organizations have had a somewhat different focus, the ultimate goal was the same: to better understand how the IRS was going about achieving its difficult mission. Now TRAC and Tax Analysts have joined forces to offer a new series of monthly reports on a range of enforcement subjects, beginning with the use of the government's criminal powers. Forthcoming will be monthly reports on tax audits, collections and other related issues. In addition, more detailed information, obtained by following the "More" links, will be available at no cost for the first six months. When monthly 2008 prison sentences of 1 year or more of this type are compared with those of the same period in the previous year, the number of convictions was down 3.8 percent. However, prison sentences of 1 year or more over the past year are still much higher than they were five years ago. Overall, the data show that prison sentences of 1 year or more for tax fraud are up 45.2 percent from levels reported in 2003. The increase from the levels five years ago in tax fraud prison sentences of 1 year or more is shown more clearly in Figure 1. The vertical bars in Figure 1 represent the number of tax fraud prison sentences of 1 year or more recorded on a month-to-month basis. The superimposed line on the bars plots the six-month moving average so that natural fluctuations are smoothed out. The one and five-year rates of change in Table 1 and in the sections that follow are all based upon this six-month moving average. Figure 1: Criminal Tax Fraud Prison Sentences of 1 Year or More since January 2001 Figure 2: Prison Sentences of 1 Year or More by Investigative Agency In July 2008, the IRS was recorded as the lead investigative agency for 20 of the tax fraud cases which resulted in prison sentences of 1 year or more, or 87 percent of the total. The only other agencies with tax fraud convictions which resulted in sentences of a year or more were Other Department of Justice (9 percent) and FBI (4 percent). See Figure 2. Tax Fraud Prison Sentences of 1 Year or More in U.S. District Courts Top Ranked Lead Charges Table 2 shows the top lead charges recorded in the prison sentences of 1 year or more of tax fraud matters filed in U.S. District Court during July 2008. Lead Charge Count Rank   26 USC 7206 - Fraud and False statements 10 1 More 26 USC 7201 - Attempt to evade or defeat tax 4 2 More 18 USC 371 - Conspiracy to commit offense or to defraud US 3 3 More 18 USC 287 - False, fictitious or fraudulent claims 2 4 More 26 USC 7203 - Willful failure to file return, supply information 2 4 More 18 USC 286 - Conspiracy to defraud the Government claims 1 6 More 18 USC 1348 - Securities Fraud 1 6 More Table 2: Top Charges for Prison Sentences of 1 Year or More "Fraud and False statements" (Title 26 U.S.C Section 7206) was the most frequently recorded lead charge. Ranked second in frequency was the lead charge "Attempt to evade or defeat tax" under Title 26 U.S.C Section 7201. Ranked third was "Conspiracy to commit offense or to defraud US" under Title 18 U.S.C Section 371. Top Ranked Judicial Districts Judicial District Count Rank   Maryland 3 1 More Ga, N 2 2 More Penn, E 2 2 More Arizona 1 4 More Fla, M 1 4 More Ga, S 1 4 More Ill, N 1 4 More Ken, W 1 4 More Mass 1 4 More Mich, E 1 4 More Montana 1 4 More N. J. 1 4 More N. Y., E 1 4 More Ohio, N 1 4 More Okla, N 1 4 More Penn, M 1 4 More S Car 1 4 More Tenn, W 1 4 More Texas, N 1 4 More Table 3: Top 10 Districts In July 2008 the Justice Department said the government obtained 9.2 tax fraud prison sentences of 1 year or more for every ten million people in the United States. Understandably, there is great variation in the number of tax fraud convictions in each of the nation's ninety-four federal judicial districts. The districts registering the largest number of prison sentences of 1 year or more of this type last month are shown in Table 3. The District of Maryland—with 3 prison sentences of 1 year or more—was the most active during July 2008. The Northern District of Georgia (Atlanta) and Eastern District of Pennsylvania (Philadelphia) ranked second. Top Ranked District Judges At any one time, there are about 680 federal District Court judges working in the United States. The judges recorded with the largest number of new tax fraud crime cases resulting in convictions of this type during July 2008 are shown in Table 4. Judge Count Rank   Brody, Anita Blumstein Penn, E 2 1 More Martin, Beverly B. Ga, N 1 2 More O'Kelley, William Clark Ga, N 1 2 More Edenfield, Berry Avant Ga, S 1 2 More Russell, Thomas B. Ken, W 1 2 More Chasanow, Deborah K. Maryland 1 2 More Davis, Andre Maurice Maryland 1 2 More Titus, Roger W. Maryland 1 2 More Young, William G. Mass 1 2 More Lawson, David M. Mich, E 1 2 More Molloy, Donald W. Montana 1 2 More Ackerman, Harold Arnold N. J. 1 2 More Garaufis, Nicholas N. Y., E 1 2 More Gaughan, Patricia Anne Ohio, N 1 2 More Payne, James H. Okla, N 1 2 More Vanaskie, Thomas I. Penn, M 1 2 More Duffy, Patrick Michael S Car 1 2 More Fish, A[llen] Joe Texas, N 1 2 More Table 4: Top Judges All 18 of the top judges were in districts which were in the top ten with the largest number of tax fraud convictions. (Because of ties, there were a total of 18 judges in the "top ten" rankings.) Judge Anita Blumstein Brody in the Eastern District of Pennsylvania (Philadelphia) ranked first with 2 convicted in tax fraud convictions. Judges Beverly B. Martin in the Northern District of Georgia (Atlanta), William Clark O'Kelley in the Northern District of Georgia (Atlanta), Berry Avant Edenfield in the Southern District of Georgia (Savannah), Thomas B. Russell in the Western District of Kentucky (Louisville), Deborah K. Chasanow in the District of Maryland, Andre Maurice Davis in the District of Maryland, Roger W. Titus in the District of Maryland and William G. Young in the District of Massachusetts were among the judges ranked second with one tax fraud conviction each.

Copyright 2008, TRAC Reports, Inc. The Transactional Records Access Clearinghouse (TRAC) is a data gathering, data research and data distribution organization at Syracuse University. TRAC's purpose is to provide the American people — and institutions of oversight such as Congress, news organizations, public interest groups, businesses, scholars and lawyers — with comprehensive information about staffing, spending, and enforcement activities of the federal government.