Attorneydiction.com, – Carolina, Missouri attorney indicted on tax and fraud charges
Two tax attorneys from Missouri and an insurance agent from North Carolina have been charged with helping clients set up tax havens, filing fake tax returns and defrauding insurance companies, federal prosecutors said. .
Michael Elliott Kohn and Catherine Elizabeth “Liza” Chollet, attorneys at St. Louis and licensed insurance agent David Shane Simmons, of Jefferson, North Carolina, had been operating the elaborate scheme since 2011, a federal grand jury said in the indictment. Kohn and Simmons misled insurance companies by providing false information about policy applications. Agents spent more than $200 million on coverage and Simmons shared important services with his supporters, according to the US Department of Justice. The plane was not named in court documents.
Simmons allegedly filed fraudulent tax returns by understating his business income and business investments, the department said in a statement. The three sold wealthy clients in what they called a profit-clearing scheme, a tax haven designed to hide client income from business investments, royalties and management fees, according to the indictment.
“In fact, Kohn and Chollet falsified the filing and management costs of the material,” defrauding the United States Department of the Treasury tens of millions of dollars in taxes, the jury said. Simmons’ attorney issued a statement Thursday saying Simmons “denies the allegations and charges of wrongdoing.” He added that the company “has faithfully served its customers for almost 15 years” and he was looking forward to the opportunity to clear his name.
The Jefferson Simmons Insurance Group website says he spent nearly a decade in banking before becoming an insurance agent in 2006. The company, located near Asheville, offers health, lifestyle and wellness products.
The DOJ in the indictment did not say how authorities learned of the alleged scheme, but the indictment says a federal agent posing as a businessman with clients seeking financial services contacted Simmons. In a meeting with the secret service, Simmons described Kohn as a “cruel man”, in a desire to exempt taxes – ready to “see prison”, but not enter it.
He explains that Kohn frequently reviews previous clients’ tax returns, finds errors, and resubmits corrected returns seeking refunds. In 2018, Simmons, Kohn, and Chollet encountered a second undercover agent posing as a booth owner in Texas. Kohn, according to the indictment, explained that he could reduce the owner’s tax liability by setting up the business as a limited partnership owned by a charitable organization. “To provide financial resources, we will be prepared to switch charitable capital accounts as soon as one year after the relationship ends,” Kohn told the private employee, according to the indictment. “So we’re going to withdraw life insurance so that if he dies there will be enough money to draw from the charity’s financial account.”
During the insurance application process, Kohn and Simmons provided the insurer with false information about the purpose of the policy, false financial information about the applicant and false information about the policy beneficiary, according to the condition of the body charged. In acknowledgment, Simmons later said he did not commission the policy.
Kohn and Chollet are registered tax attorneys at Kohn Partnership in Clayton, Missouri, outside St. Louis.
If found guilty of those charges, Chollet could face up to eight years in prison. Kohn and Simmons could face up to 20 years in prison, the DOJ said. Prosecutors have asked the defendants to seize $3.2 million in assets.***