Criminal Justice
Did alleged sham hiring by SCOTUSblog founder Goldstein constitute tax evasion? Judge will decide
Indicted SCOTUSblog co-founder Tom Goldstein can’t sell his home to pay his defense attorneys, a federal judge ruled last week as she denied six of his pretrial motions in the tax evasion case against him. (Photo by Alex Brandon/The Associated Press)
Indicted SCOTUSblog co-founder Tom Goldstein can’t sell his home to pay his defense attorneys, a federal judge ruled last week as she denied six of his pretrial motions in the tax evasion case against him.
But U.S. District Judge Lydia Kay Griggsby of the District of Maryland didn’t immediately rule on Goldstein’s motion to dismiss tax evasion charges related to four women he hired at his law firm alleged to have done little or no work. The government alleges that payments to the women, with whom Goldstein pursued romantic relationships, should have been treated as distributions to Goldstein for which he owed taxes.
Bloomberg Law and Law360 covered the Nov. 6 hearing in which Griggsby ruled from the bench. She chronicled her decisions in an order issued the same day.
Goldstein is a former U.S. Supreme Court litigator and a high-stakes poker player. He is accused of hiding millions of dollars in income and cryptocurrency transactions on tax returns. He is also accused of using his boutique firm, Goldstein & Russell, to help cover his debts and of making false statements to mortgage lenders.
He is charged with tax evasion, aiding and assisting the preparation of false and fraudulent tax returns, willful failure to pay taxes, and making false statements on mortgage loan applications.
During the hearing, lawyers for Goldstein argued that he can’t be charged with five counts of willful failure to pay taxes because he paid all the money that he owed, along with penalties and interest after agreeing to a payment plan, according to Law360. But Griggsby said the law is clear that taxpayers can be charged for failing to pay taxes, even when the amount due is eventually settled. And a jury must decide whether failure to pay taxes is willful, she said.
Regarding the allegedly sham employees, Griggsby indicated that she is inclined to rule for Goldstein but said she would wait for additional briefing from the government before deciding, Bloomberg Law reports.
Goldstein said three of the women performed some work for his firm, and the fourth went on medical leave soon after her hiring. Griggsby indicated that she had some concerns that the tax evasion statute as applied to the employment arrangement was impermissibly vague.
Ruling on the home sale, Griggsby said the home that Goldstein owns with his wife is collateral to secure his appearance and could be subject to forfeiture if it is a tainted asset, Bloomberg Law reports. Prosecutors have claimed that Goldstein could sell a $100,000 watch to pay his lawyers, Law360 says.
Goldstein had sought to substitute South Carolina properties owned by his family.
See also:
SCOTUSblog founder Tom Goldstein had motive for money offers to firm manager, prosecutors allege
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