Renaissance / The Tax People President Convicted!

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Demosthenes
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Renaissance / The Tax People President Convicted!

Postby Demosthenes » Thu Feb 28, 2008 9:49 pm

FOR IMMEDIATE RELEASE
TAX
THURSDAY FEBRUARY 28, 2008

KANSAS-BASED TAX SCHEME PROMOTER CONVICTED IN $78 MILLION FRAUD
WASHINGTON – Michael Craig Cooper today was convicted in Kansas City, Kan., on tax and fraud charges after a six week jury trial, the Justice Department and Internal Revenue Service (IRS) announced. Cooper was the president and founder of Renaissance - The Tax People, which was headquartered in Topeka, Kan.

According to the evidence introduced at trial, from 1997 until 2002, Cooper and others conspired to defraud the United States and Renaissance clients by marketing a program that purported to educate individuals on how to start a home based business in order to fraudulently convert personal expenses into business deductions through false and misleading representations. Cooper assisted clients in preparing and filing false tax returns on which the clients claimed tax deductions by falsely characterizing personal expenses as business expenses. In this manner, clients illegally reduced their taxable income by deducting personal expenses, including children's allowances, commuting expenses, educational expenses and vacation expenses. This scheme was also promoted under the name Advantage International Marketing (AIM).

In December 2006, Cooper was charged in a superseding indictment with one count of conspiracy to defraud the United States, 56 counts of assisting in the preparation of a false tax return, 36 counts of mail fraud, 11 counts of wire fraud and 44 counts of money laundering.
“Citizens who pay their fair share of taxes can rest assured that the Department of Justice will continue to utilize all our resources to prosecute those who choose to cheat and engage in fraud,” said John A. Marrella, Deputy Assistant Attorney General of the Justice Department Tax Division. “To those citizens who choose to engage in tax fraud, our warning is: we are going to prosecute you and do our best to put you in jail.”

Cooper faces a maximum sentence of 20 years for each of the most serious counts of conviction and a fine of up to $250,000 for each count. The government also sought forfeiture of $84 million in proceeds from the fraud, including, United States currency, land, vehicles, gold coins, bank accounts and life insurance policies. U.S. District Court Judge Carlos Murguia will be holding a hearing on the forfeiture prior to sentencing, which is set for May 19, 2008.
“Mr. Cooper exploited his customers and attempted to steal from the honest taxpayers of the United States,” said Eric F. Melgren, the U.S. Attorney for the District of Kansas. “Despite all the cunning marketing, Renaissance-The Tax People was nothing but a scam.”

Defendants Daniel Joel Gleason, Jesse Lyala Cota, Todd Eugene Strand, Thomas Steelman Sr., Frances Ruth and Elizabeth Crotts pled guily to charges related to this scheme and testified at trial. Gleason, Cota, and Strand were charged in the indictment with Cooper.

Gleason, previously the owner and operator of a tax preparation service, My Tax Man, pled guilty on Oct. 10, 2006 to conspiracy to defraud the United States and aiding and assisting in the preparation of filing of false tax return. Cota, a former IRS District Director for the Southern District of California, plead guilty on March 27, 2006, to conspiracy to defraud the United States. Strand pled guilty on March 27, 2006, to conspiracy to defraud the United States and one court of mail fraud. In his plea, Strand admitted that the conspiracy defrauded Renaissance customers of more than $75 million and caused a tax loss of more than $20 million.
“Marketing programs to take illegal tax deductions through false and misleading representations, isn’t tax planning; it’s criminal activity,” said Eileen Mayer, Chief, IRS Criminal Investigation. “IRS Criminal Investigation has made the investigation of individuals who market or who intentionally buy into abusive tax schemes a national priority. Today’s conviction speaks strongly to our successful efforts in stopping this growing area of fraud.”

The case was prosecuted by Assistant U.S. Attorney Scott C. Rask and Justice Department Tax Division trial attorney Charles A. O’Reilly and was investigated by the IRS Criminal Investigation.
Demo.

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Dr. Caligari
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Re: Renaissance / The Tax People President Convicted!

Postby Dr. Caligari » Thu Feb 28, 2008 11:38 pm

and is only eligible for parole after he has served half of his sentence


There is no more parole in the federal system. A sentence can be reduced by up to 15% for good behavior in prison, but he will have to serve at least 85% of his sentence.
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Re: Renaissance / The Tax People President Convicted!

Postby grixit » Fri Feb 29, 2008 12:20 am

Has there been any response in the tardesphere yet?
I voted for Hillary, and i didn't even get a stupid tshirt!

10 . . . . . . . . . . . . . . . 2
. . . . . . Dr Pepper
. . . . . . . . . . . . . . .. . . 4

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Mr. Mephistopheles
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Re: Renaissance / The Tax People President Convicted!

Postby Mr. Mephistopheles » Fri Feb 29, 2008 2:02 am

Topeka, huh? I wonder if drinks from the same tainted water as Fred Phelps? If you anyone here thinks the TP diatribes are wacky, read some of Phelp's nonsense. Freaky, freaky dude.

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Demosthenes
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Re: Renaissance / The Tax People President Convicted!

Postby Demosthenes » Sun Oct 18, 2009 4:58 pm

Tax People exec gets 4 years

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BY STEVE FRY
Created October 16, 2009 at 10:18am
Updated October 16, 2009 at 11:49am
A former executive of the defunct Renaissance, The Tax People, was sentenced to 51 months in prison for tax fraud and ordered to pay more than $10.6 million in restitution to the Internal Revenue Service.
Todd Eugene Strand, 39, of Topeka, who pleaded guilty to one count of conspiracy to defraud the IRS and one count of mail fraud, was the seventh Renaissance executive or employee to be sentenced. Strand was sentenced Friday at the Robert J. Dole U.S. Courthouse in Kansas City, Kan.
In his plea, Strand, formerly of Murrieta, Calif., admitted that in November 1995, he began working as a marketing associate with Renaissance. The company, which was based in the former Fleming Mansion at S.W. 10th and Gage, offered its members services that included tax advice, tax return preparation and so-called "audit protection." Over time, Strand became a right-hand man to Renaissance founder Michael Craig Cooper and was promoted to vice president and national marketing director.
Strand will be allowed to voluntarily surrender to start his sentence, but a specific date hasn't been scheduled, said Jim Cross, spokesman for the U.S. Attorney's Office in Kansas.
Once a judge orders a defendant to be incarcerated, the U.S. Bureau of Prisons decides when and where he is to report to start his sentence, as well as what correctional facility the sentence will be served in, Cross said.
From 1995 through April 2002, the conspiracy in which Strand was a participant fraudulently generated approximately $75 million in income from Renaissance members by means of false and misleading claims made in marketing materials and during conference calls, rallies, and promotional meetings, authorities said.
Cooper, 55, founder and president of Renaissance, is to be sentenced Nov. 18. Following a jury trial, Cooper was convicted Feb. 28, 2008, of 73 federal felonies.
The convictions are one count of conspiracy to defraud the IRS, to commit wire fraud and to commit mail fraud; 17 counts of mail fraud; 11 counts of wire fraud; one count of money laundering conspiracy; 41 counts of unlawful monetary transactions of criminally derived property worth more than $10,000; and two counts of money laundering.
Jurors acquitted him of 56 counts of preparing false tax returns and 19 counts of mail fraud.
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Re: Renaissance / The Tax People President Convicted!

Postby KickahaOta » Tue Dec 16, 2014 7:03 pm

On December 15, 2014, Michael Craig Cooper's habeas corpus petition was rejected by the Tenth Circuit Court of Appeals.

The opinion is available at http://www.ca10.uscourts.gov/opinions/13/13-3326.pdf. A quick summary of his arguments and the failures thereof:

  • Trial counsel was ineffective in failing to move for dismissal based on a Speedy Trial Act violation: Wrong, because the Act probably wasn't violated, and even if it was, the dismissal would have been without prejudice (and thus would accomplish nothing, since he would be immediately re-indicted).
  • Mistrial/jury taint: During deliberations, the foreperson discussed out-of-court research and said that Cooper was lying and guilty. Foreperson was removed. Trial counsel was ineffective in failing to move for mistrial. Wrong, because trial counsel had strategic reasons for doing so: the trial had gone well, a second trial would probably have a more unfavorable jury, Cooper agreed to the strategy, and all the remaining jurors said they could be impartial. Cooper claimed that counsel admitted that the reason for not moving for mistrial was that counsel's law practice couldn't afford the time for another trial; district court found this "inherently incredible", among other things. Also, district court would have denied a mistrial, making the whole thing moot.
  • Trial counsel was ineffective for failing to object that the jury instruction required the jury only to find that Cooper used or caused another person to use the wires, rather than that a wire transfer had actually taken place. I'm not sure what the difference would be, and the courts didn't see it either; and there were plenty of allegations of actual wire communications.
  • Government did not present evidence of wire transfers to the jury. Wrong, and not considered since it wasn't argued in the lower courts.
  • Trial counsel was ineffective for failing to argue that the mail fraud statute doesn't cover cases where a person causes someone else to send or deliver mail. Wrong, because it does.
  • Trial counsel was ineffective for failing to object to summary testimony and exhibits. Wrong, because Cooper failed to point out anything wrong with any particular piece of evidence, and did not try to show prejudice.
  • Appellate counsel was ineffective for failing to raise the above claims. Wrong, because the above claims are wrong.
  • Trial counsel failed to adequately prepare a defense. Wrong, because counsel investigated and performed adequately, and there was no evidence that Cooper actually told his counsel about the witnesses he wanted presented, nor what any of them would helpfully say.
  • Trial counsel failed to argue against a sentencing enhancement that violated Apprendi. Wrong, because Cooper completely failed to explain his argument.
  • Trial counsel failed to present Cooper with two plea offers. Wrong, because counsel was credible and Cooper not credible. In the district court's words, Cooper appeared "self-serving, deliberate, measured, and calculated. [He] seemed willing to say anything to reduce his sentence." Furthermore, no prejudice, because Cooper proclaimed his innocence all the while.
  • Cumulative error. Wrong, because zero plus zero does not equal prejudice.

Michael Craig Cooper remains federal prisoner #44952-179, release date April 21, 2022. Condolence cards can be sent to Bastrop Federal Correctional Institution, 1341 Highway 95 North, Bastrop, TX 76802.

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Re: Renaissance / The Tax People President Convicted!

Postby Hyrion » Tue Dec 16, 2014 7:34 pm

Demosthenes wrote:In his plea, Strand admitted that the conspiracy defrauded Renaissance customers of more than $75 million and caused a tax loss of more than $20 million.

I wonder if I understand that correctly:

    For each $1 of tax they saved their clients, they billed their clients $3.75
If I understand that correctly: Their clients were obviously not paying attention to what their "tax savings" were costing them.

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Re: Renaissance / The Tax People President Convicted!

Postby KickahaOta » Tue Dec 16, 2014 7:52 pm

Hyrion wrote:
Demosthenes wrote:In his plea, Strand admitted that the conspiracy defrauded Renaissance customers of more than $75 million and caused a tax loss of more than $20 million.

I wonder if I understand that correctly:

    For each $1 of tax they saved their clients, they billed their clients $3.75
If I understand that correctly: Their clients were obviously not paying attention to what their "tax savings" were costing them.


Two possible explanations spring to mind there:
  • This wasn't just a tax avoidance scheme; it was a pyramid scheme. So you were paying for the privilege of recruiting a downline (and theoretically getting revenue from them), as well as for the tax advice.
  • If I pay $1000 for tax advice that I'm told will get me $10000 of tax savings, that's a sensible investment for me (aside from the whole "cheating and fraud" thing). If the IRS then disallows my tax return and charges me interest and penalties, and I pay up, then I've still been defrauded, but the tax loss to the government is (theoretically) zero.


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