Receiving “A+” grades were Idaho, Oklahoma, Texas, and Utah; receiving “F” grades were California, Hawaii, Rhode Island, and Vermont. The three worst performing cities were all in California: Los Angeles, Sacramento, and San Diego. The top three cities were Oklahoma City, Dallas/Fort Worth, and San Antonio. Nevada received a “B+” while Maryland received a “C-”. Las Vegas ranked 10th of the 40 cities surveyed.

The interactive map is available here while the full survey can be found here. A press release on the results is also available.

Mrs. Rober owned Gator Water and Wastewater Management, Inc. The business was sold, and payments came in. The Robers skimmed money off of each payment and kept it for personal expenses. They neglected to tell their accountant about the skim. Did I mention that Mr. Richey was the mayor of Port Richey, Florida?

All might have been well except that the company that bought Gator Water alleged that the Robers were skimming. The IRS launched an investigation and found out the allegation was true. Today, the Robers pleaded guilty to one count each of tax evasion.

As usual, it’s a whole lot easier to just pay the tax you owe in the first place…especially if you’re in the public eye.

Earlier this year, he found himself indicted for tax fraud along with two others, Jamie Russ-Walls and Richard Walls. The alleged scheme involved phony tax refunds; Mr. Mitchell is alleged to have recruited individuals to receive the fraudulent refunds.

Well, Mr. Mitchell doesn’t think much of his co-defendants. He filed a lawsuit against them today alleging fraud, breach of contract and infliction of emotional distress. Mr. Mitchell’s attorney, Richard F. Klineburger III, told the Philadelphia Inquirer, “In the end, Freddie’s taxes are still a mess, his friends got ripped off by these con artists and his reputation is tarnished…I truly believe that he will be vindicated in the end.”

The Vikings didn’t get everything they wanted. The Vikings will have to contribute about $50 million more than they wanted to ($477 million in total) for the $975 million facility. But the Vikings overall share of the cost (49%) tells you that the citizens of Minnesota will be paying for this in one way or another.

The state’s share ($348 million) will come through an expansion of charitable gambling. Gambling may be a “sin” in the view of many but when it comes time to raise money it’s always one of the first things looked at. Minneapolis must also contribute to the stadium ($150 million); that will mainly come from sales tax. Of course, as the Wall Street Journal points out, new stadiums rarely pay for themselves.

The Vikings currently play in the Metrodome, an aging facility whose roof collapsed a couple of years ago. The new stadium (to be build on the site of the Metrodome) is expected to open in 2016. It’s likely the Vikings will play for three seasons at the University of Minnesota’s TCF Bank Stadium.

News Stories: Star-Tribune, Wall Street Journal

Here, the connection is that the owner of B & B Weaving Shop in Montgomery, Alabama has a daughter who owns B & B Tax Service (conveniently in the same building). Barbara Murry, the mother, and Yolanda Moses, the daughter, have something else in common: They are among nine family members charges with tax fraud and theft of public funds. They’re accused of preparing false tax returns via identity theft and having over $1.3 million deposited in their bank accounts.

And that’s not the only case of identity theft and tax fraud out of Montgomery from last week. Chiquita Smith pleaded guilty to one count of conspiring with at least two other people to defraud the United States by obtaining and aiding to obtain the payment and allowance of false, fictitious, and fraudulent claims. Ms. Smith also pleaded guilty to identity theft. The press release doesn’t state the amount of tax loss, but it appears she may be heading to ClubFed.

[She] admitted that from “at least” 2003 through October 2006, she conspired with Wirth and their tax return preparer Michael James Murry to defraud the Internal Revenue Service by failing to report and pay their true income and tax obligations.

I’d say Mr. Wirth’s defense just became a lot more difficult: Ms. Damiani is working with the US Department of Justice. The trial of Mr. Wirth and Mr. Murry is scheduled for May 29th.

Similarly, workers compensation is sometimes run through government and pseudo-government agencies. In California, there is the State Compensation Insurance Fund. The State Fund is a non-profit public-enterprise fund run like a mutual insurance company. However, it was created by the state of California. That makes it a pseudo-government agency. It’s a very bad idea to commit fraud against the government; it’s even worse to get caught.

George Osumi II has a construction business in Irvine. He apparently has his workers compensation insurance through State Fund. Mr. Osumi allegedly had a unique and, if proven, quite illegal method of lowering his insurance costs: He reported on his workers compensation report $3.5 million less in payroll than his actual payroll. That did allegedly save him several hundred thousand dollars in insurance costs. It’s also a felony. And since Mr. Osumi is alleged to have done underreported his wages 18 times, that’s 18 felony counts.

Adding to Mr. Osumi’s problems is that he is also alleged to have withheld state taxes and not remitted them. State tax agencies are just as certain to go after business owners as the IRS if you don’t remit withheld taxes. In total, Mr. Osumi faces 71 felony counts including perjury (he’s alleged to have lied to the State Contractor’s Board in stating that his business did not require workers compensation insurance), identity theft, and a host of state tax charges. Mr. Osumi is looking at up to 63 years in prison if found guilty on all the charges.

News Reports: OC Register, Daily Pilot

1. Texas
2. Florida
3. North Carolina
4. Tennessee
5. Indiana
6. Virginia
7. South Carolina
8. Georgia
9. Utah
10. Arizona

41. Hawaii
42. Oregon
43. Pennsylvania
44. Connecticut
45. New Jersey
46. Michigan
47. Massachusetts
48. Illinois
49. New York
50. California

The two states that made the biggest moves were Oregon and Louisiana. Oregon fell nine spots in the ranking, likely due to their income tax increase that passed last year. On the other end of the spectrum is Louisiana, which was ranked 47th in 2006 but is now ranked 13th (up 27 spots from 2011).

Meanwhile, Chief Executive describes California as having slipped deeper into the ninth circle of business hell. Perhaps this section of the report will enlighten Sacramento:

The following is a representative sample of comments from participating CEOs:

• California is the worst! They are doing everything possible to drive a business out of their state. If it were not for the climate, they would have lost half their population.
• California regulations, taxes and costs will leave only tech, life sciences and entertainment as viable. If you aren’t an elitist, no room here for the middle or working classes.
• California treats business owners like criminals. California has different overtime policies for its own employees vs. private sector.
• California’s labor regulation is a job killer. We will be moving our business out of the state, which will lose hundreds of jobs simply due to the poor regulatory environment.
• California should secede from the union—it is like doing business in a foreign country, it has its own exchange rate, and its regulation is crazy.

Meanwhile, the budget deficit in California grows (the Legislative Analyst says it’s at $3 billion and will grow from that number). Perhaps the idea of cutting regulations and spending just what the state takes in might garner some support in Sacramento. Well, one can always dream….

From the DOJ Press release:

More specifically, [seven of] the defendants are charged with forgery of U.S. Treasury checks, in violation of Title 18, United States Code, Section 510, theft of government money, in violation of Title 18, United States Code, Section 641, and use of five or more identification documents with unlawful intent, in violation of Title 18, Untied States Code, Section 1028(a)(3).

The two former NFL players are William Joseph, who started his career with the New York Giants and ended his career in Oakland with the Raiders and Michael Bennett, who started his career with the Minnesota Vikings and also ended his career with the Raiders. Mr. Bennett, though, was sacked on different charges.

Mr. Bennett went to the storefront and asked for a loan, showing what purported to be $9 million of collateral in a bank account with UBS. The trouble was the balance in the account was $9 million less than what Mr. Bennett showed at the store (the account allegedly had no funds in it). Oops. Mr. Bennett has been charged with wire fraud.

Most of the defendants are accused of cashing between 11 and 35 fraudulently obtained tax refund checks. I am seeing and hearing more examples of identity theft; as noted in the DOJ press release,

U.S. Attorney Wifredo A. Ferrer stated, “Not only is identity theft America’s fastest-growing crime, it’s also a consumer’s worst nightmare. Most recently, identity theft has become a taxpayer’s worst nightmare also. As this three month undercover operation illustrates, identity thieves are using stolen identities to commit steal tax refunds from legitimate taxpayers. Identity theft, when combined with tax refund schemes, threatens the financial security of our citizens. It is time for tax refund scammers to realize that we will not allow them to steal others’ identities and line their pockets through fraud.”

As John V. Gillies, Special Agent in Charge of the FBI’s Miami Division, stated, “Without proper safeguards, identity theft tax fraud has become a growing epidemic.” Hopefully, these arrests are not the end of the FBI and DOJ actions against identity theft criminals.

News Story (Miami Herald)