Montgomery Sibley was the attorney for the D.C. Madam, Deborah Jeane Palfrey. He has written a book about her and the judicial system events that led to her ultimate suicide available now.
Why Just Her
The DC Madam and the IRS
By
One of the untold stories about the D.C. Madam involves the Internal Revenue Service. It was in June 2006 that the Senate Judiciary Committee approved a bill sponsored by committee chairman Sen. Charles Grassley, R-Iowa, authorizing at least $2 million toward the establishment of an office in the IRS criminal investigation unit to prosecute unlawful sex workers for violations of tax laws.
How curious it was then that the IRS immediately found an ally in the U.S. Postal Service which has been investigating since 2000 – but not charging – a minor escort agency in the
I will skip over the rest of the story quickly. Jeane’s assets were seized by IRS investigators in October 2006, she was indicted in March 2007, tried in April 2008 and committed what I call court-induced suicide on May 1, 2008. I am sure Senator Grassley was pleased to get such a dangerous criminal off the street, though the IRS did leave 89 other escort agencies operating – and still operating – in the
The IRS spent thousands of man-hours collecting each Postal Money order sent to Jeane and tracking it back to the escort who sent it. The spreadsheets with this information run to the hundreds of pages. At Jeane’s criminal trial, the IRS agent,
Q. Does Ms. Palfrey’s [Federal Tax] return show gross receipts or net receipts?
A. It shows gross receipts.
Q. And where does it show that?
A. On line one, under part one for the income, it shows the gross receipts.
Q. And what [are] gross receipts, just to make sure?
A. Gross receipts in this instance would be all the income that was received by the business during that year.
Q. And did you compare the tax returns to the bank records for Ms. Palfrey?
A. Yes.
Q. And what did that show?
A. The comparison of the bank records for this year, 2002, show that there was a greater amount of gross receipts than was reported on this line.
Simply stated, Jeane under reported her income for 2002 – and as Agent Burrus’ records revealed for every other year as well. But Jeane was not charged with an tax offenses? Why? I believe it was because such a charge would have opened the door to an intense investigation by Jeane’s defense team as to whether it was to please the powerful Senator Grassley who held their purse strings. Hence, the tax crimes that could have been charged were not charged.
Ah, the IRS acting to appease the powerful . . . who would have thought it!
No comments:
Post a Comment