United States District Court, W.D. North Carolina, Charlotte Division
COGBURN JR. UNITED STATES DISTRICT JUDGE.
MATTER is before the Court on Defendant's Motion
for Judgment of Acquittal pursuant to Federal Rule of
Criminal Procedure Rule 29. (#42).
March 18, 2019, Defendant was charged by Superseding
Indictment with twenty counts of aiding and assisting in the
filing of false tax returns and three counts of filing a
false tax return. (Doc. No. 27). Jury selection was completed
on May 20, 2019, and the presentation of evidence began on
May 28, 2019. Following the close of the Government's
case, on May 29, 2019, Defendant moved for judgment of
acquittal. The Court heard oral argument and denied
Defendant's motion. On May 30, 2019, Defendant was
convicted of all twenty-three counts. (Doc. No. 39). On June
13, 2019, Defendant filed the instant Motion, moving for a
judgment of acquittal as to Counts Twenty One through Twenty
Three of the Superseding Indictment. (Doc. No. 42).
Standard of Review
considering a post-verdict motion for judgment of acquittal
under Rule 29 of the Federal Rules of Criminal Procedure, the
court assesses whether, taking the evidence in the light most
favorable to the Government, a rational trier of fact could
have found the essential elements of the charged offense
beyond a reasonable doubt. See United States v.
Higgs, 353 F.3d 281, 313 (4th Cir. 2003) (holding that a
conviction must be sustained if there is “evidence that
a reasonable finder of fact could accept as adequate and
sufficient to support a conclusion of a defendant's guilt
beyond a reasonable doubt”) (quoting United States
v. Burgos, 94 F.3d 849, 862 (4th Cir. 1996) (en banc)).
The court does not weigh the credibility of witnesses but
accepts any such determinations made by the jury which are
necessarily resolved by the verdict. See United States v.
Wilson, 118 F.3d 228, 234 (4th Cir. 1997) (holding that
credibility determinations are reserved for the jury, and if
the evidence supports different, reasonable interpretations,
the jury decides which interpretation to believe) (internal
quotation marks omitted); United States v.
Arrington, 719 F.2d 701, 704 (4th Cir. 1983). In making
a Rule 29 motion, “[a] defendant challenging the
sufficiency of the evidence to support his conviction bears
‘a heavy burden.'” United States v.
Beidler, 110 F.3d 1064, 1067 (4th Cir. 1997) (citation
omitted). “Reversal for insufficient evidence is
reserved for the rare case ‘where the prosecution's
failure is clear.'” Id. (quoting Burks
v. United States, 437 U.S. 1, 17 (1978)).
hearing the evidence, the jury convicted Defendant of Counts
Twenty One through Twenty Three of the Superseding
Indictment, which alleged violations of 26 U.S.C. §
7206(1). (Doc. No. 27). Defendant argues that the Government
failed to introduce evidence of any direct income to
Defendant in 2013 and 2014 and that the Government failed to
prove that Defendant was the owner of Smith Tax and Insurance
and required to report the business and its income on her tax
return. Defendant further argues that the Government failed
to follow requisite steps for a bank deposits method of proof
for the 2015 tax year to establish total income. For the
following reasons, the motion will be denied.
2013 and 2014 Tax Returns (Counts Twenty One and Twenty
Superseding Indictment, the Government alleged that Defendant
willfully filed false tax returns in 2013 and 2014 when she:
(1) failed to disclose that she was engaged in the operation
of a business activity from which she derived gross receipts,
knowing that she was engaged in the operation of a business
activity from which she derived gross receipts, specifically
her tax preparation business; and (2) reported her total
income in 2013 and 2014 on Lines 15 and 22 was $22, 012 and
$24, 341, respectively, where as she knew her total income on
Lines 15 and 22 was substantially greater. (Doc. No. 27). At
trial, as part of the defense, Defendant attempted to
categorize three of Defendant's businesses as separate
from one another and subject to different reporting
requirements. The Government introduced, however, more than
sufficient evidence for a reasonable juror to find that these
three businesses-Touch by Angels Tax Service, Touch by Angels
Accounting, and Smith Tax and Insurance-were different in
name only and all reflected the same preparation business,
for which Defendant was the owner and which she should have
reported on her 2013 and 2014 tax returns.
trial, the Government called Kristy Morgan, an IRS Service
Center Representative, who testified that Defendant applied
for and was rejected for an EFIN in the name of Touch by
Angels Tax Services in February 2010 for lack of suitability,
and that an application referencing the name of Ben Smith
applied for an EFIN in the name of Touch by Angels Accounting
Services in October 2010 and Smith Tax & Insurance Group,
LLC in December 2012. (Govt. Ex. (“GX”) GX 16,
18, 74, 76, 78). Further, the Government, through Ms. Morgan,
offered Exhibit 75, which is a Personal Associated
Application for Aminta Smith. On this document, Smith Tax
& Insurance Group is listed as an associated application
for Defendant and she is listed as a “Delegated
User.” (GX 75).
Government also called Meshawn Jean-Louis from Santa Barbara
Bank and Trust, who testified that the purported EFIN account
holder in 2013 and 2014 for the Touch by Angels Accounting
Services account was Defendant. (GX 89A and 89B). Ms.
Jean-Louis further explained the difference between an EFIN
holder and a contact person, and testified that while Ben
Smith was at certain times listed as the contact person for
the business, from 2013-2014, the EFIN holder, perceived by
Santa Barbara to be the “owner” of the business
account, was Defendant.
Government also admitted Ben Smith's 2013 and 2014 tax
returns into evidence and Ms. Morgan testified that Ben Smith
did not claim any Schedule C tax preparation business in 2013
and 2014, and that Defendant is listed as the paid preparer.
(GX 302 and 303). Ms. Morgan also testified that in 2015, Ben
Smith did not file any tax return. (GX 314). The Government
further called IRS Special Agent Nicholas Pompei, who
testified that when he interviewed Defendant, she stated that
she was the owner of her tax preparation business called
Touch by Angels, which she had started in October 2009, and
that it was a sole proprietorship. Importantly, Defendant
failed to report any iteration of her tax preparation
business in 2013 and 2014, including the version she claims
was actually hers, Touch by Angels Tax Services, and admitted
at trial to being the owner of a tax preparation business, a
sole proprietorship, since at least 2009. (Def. Ex. 11). On
these facts alone, a reasonable juror could convict Defendant
on Counts Twenty One and Twenty Two. See Griffin v.
United States, 502 U.S. 46, 49 (1991) (when a jury
returns a guilty verdict on an indictment charging several
acts in the conjunctive, the verdict stands if the evidence
is sufficient as to any one of the acts charged).
includes lengthy discussions of alter-ego theory, piercing
the corporate veil, and the nature of LLCs in her Motion.
None of these arguments undermine the evidence the Government
established at trial. Defendant admitted to owning a tax
preparation business, her name is on numerous documents and
records for each alternate “name” for that
business, and her clients testified that they paid her to
prepare their returns in the years in question. This evidence
is sufficient to prove that in 2013 and 2014 she both
underreported her total income and failed to report ...