A former Atwater tax preparer was sentenced Monday to nine years in prison in Fresno's federal court on fraud charges.
Michael S. Ioane was convicted by a jury last year on one count of conspiring to defraud the United States and four counts of presenting fictitious documents.
Ioane, who operated under the name Acacia Corporate Management and First Amendment Publishers, among others, promoted sham or abusive trusts that purported to allow people to shield their assets and income from the Internal Revenue Service, according to Lauren Horwood, spokeswoman for U.S. Attorney Benjamin Wagner of the state's Eastern District.
When the IRS disallowed trusts set up by Ioane, he would instruct co-defendant Vincent Steven Booth of Bakersfield to set up new trusts, file false liens against Booth's properties and present bogus "bills of exchange" to the IRS that Ioane said constituted full payment of Booth's tax debt, according to Horwood.
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Ioane presented the IRS with the fake bills of exchange that claimed to extinguish Booth's tax debt. He created fake deed transfers of Booth's properties to keep it out of the reach of the IRS.
The actions allowed him to evade more than $1.3 million in back taxes, according to the U.S. attorney.
During Monday's sentencing, Judge Lawrence J. O'Neill said Ioane was "cagey, conniving, smart, wily. ... He's a sophisticated cheat. ... He is a con."
O'Neill also said the defendant regrets being caught, but doesn't regret committing the crime.
Booth pleaded guilty in September 2010 and is scheduled to be sentenced Feb. 27. He is working to pay more than $1.3 million in back taxes he owes to the IRS.
The case was the result of an investigation conducted by IRS Criminal Investigation. Assistant U.S. Attorneys Mark E. Cullers and Michele L. Thielhorn prosecuted the case.