CO-FOUNDER OF “INSTITUTE OF GLOBAL PROSPERITY” GUILTY OF TAX FRAUD

WASHINGTON. – David Alan Struckman, co-founder of the “Institute of Global Prosperity”— an organization that sold audiotapes, CD’s and tickets to offshore seminars on “wealth-building” strategies — was found guilty in a federal court in Seattle, Wash. on November 8, 2007, of tax evasion and conspiracy to defraud the United States.

According to the evidence introduced at trial, Global Prosperity received more than $45 million from selling so-called wealth-building products, and tickets to offshore seminars. The proposed wealth-building methods marketed to clients included placing client assets into purported foreign and common law “trusts” while maintaining control of the assets. The products were sold to clients for $1,250 and tickets to attend domestic and offshore seminars were sold at prices ranging from $6,250 to $37,000 each.

Struckman concealed the income earned from the sale of these products through the use of bogus trusts, nominee entities and related offshore bank accounts. He transferred funds from the offshore bank accounts back into the United States through wire transfers and the use of debit cards.

“Stopping tax schemes at the source is a high priority in tax enforcement,” said Richard T. Morrison, Acting Assistant Attorney General for the Justice Department’s Tax Division. “People who sell or use these scams can expect serious trouble, including criminal charges where appropriate.”

Struckman faces a maximum potential sentence of 20 years in jail and $1 million in fines. District Court Judge Robert M. Takasugi set a sentencing date of March 3, 2008. Struckman was remanded to jail where he will be held until the sentencing.

"Trusts established to hide the true ownership of assets and income for the purpose of committing tax evasion isn’t tax planning; it’s criminal activity," stated Eileen Mayer, Chief, Internal Revenue Service (IRS) Criminal Investigation Division. "We will continue to shut down fraudulent tax schemes and hold the abusers of these schemes accountable for their actions. It is a matter of maintaining public confidence in the fairness of the tax laws."

Acting Assistant Attorney General Richard Morrison thanked the Special Agents of the Internal Revenue Service, whose assistance was essential to the investigation and prosecution of this case. He also commended the hard work of Tax Division trial attorneys Larry J. Wszalek and Michael J. Watling who prosecuted the case.

Additional information about the “Institute of Global Prosperity,” and the injunction entered against one of its directors in 2006, can be found at http://www.usdoj.gov/tax/txdv06436.htm.

Additional information about the Justice Department’s Tax Division and its enforcement efforts may be found at http://www.usdoj.gov/tax.

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