CINCINNATI
Phillip and Joanne Caldwell, ages 48 and 41,
of Lebanon, Ohio, pled guilty here today in United States
District Court to a one-count Information charging them
with conspiracy to defraud the United States for the
purposes of committing tax fraud from 1999 to 2003.
Gregory G. Lockhart, United States Attorney for the
Southern District of Ohio, and Cromwell A. Handy, Special
Agent in Charge, Internal Revenue Service (IRS) Criminal
Investigation, announced the plea entered before Senior
United States District Judge S. Arthur Spiegel.
Phillip Caldwell is a former Certified Public Accountant
who has worked in the tax and accounting field since
the 1980's. His wife, Joanne Caldwell, is a computer
programmer who has worked for various companies in the
southwestern Ohio area since the late 1980's. Both formerly
worked at Fernald.
The Caldwells admitted that they conspired with each
other and co-defendant John Huber, age 36, of Dayton,
Ohio, to defraud the United States for the purposes
of impeding and impairing the Internal Revenue Service
by, among other things, concealing Joanne Caldwell's
income through the use of nominee companies, trusts
and trustees.
In addition, the Caldwells admitted that they failed
to file individual income tax returns reporting the
income they earned during the years 1993 through 2001.
In addition, they admitted preparing and submitting
W-4 forms to their employer, Fernald, during the years
1995 and 1996 falsely claiming exempt status without
a legal or factual basis. They also used cash extensively
in an effort to conceal their income from the IRS from
1993 through 2001.
In 1993 the Caldwells joined The Freedom Connection,
a well-known tax protest organization operating out
of the Southern District of Ohio. The organization was
headed by Thomas Jeff Frisby, whom they knew and was
later convicted of tax crimes in Cincinnati. They admitted
closing all their interest bearing personal bank accounts,
and attempted to revoke their social security numbers
with the Social Security Administration along with their
taxpayer status with the IRS. They then formed nominee
trusts and sheltered their personal and business income
and activities through these trusts and their respective
bank accounts. Finally, the Caldwells had nominee trustees
appointed to these trusts, but maintained exclusive
control over the corpus of these trusts, and were the
beneficiaries of the payments made by the trusts.
In addition, Joanne Caldwell admitted that she submitted
two forms to her employers, one falsely claiming to
be a foreign citizen, and one falsely claiming to be
a non-resident alien, despite the fact that she was
a U.S. Citizen, and continued to reside in Ohio. Moreover,
Phillip Caldwell admitted to providing backdated documents
to his brother-in-law prior to his brother-in-law's
appearance before the grand jury.
The conspiracy count to which the Caldwell's pleaded
guilty to carries a maximum penalty of five years of
imprisonment, and a $250,000 fine.
Further questions may be directed to trial attorney
Rich Rolwing of the U.S. Department of Justice, Tax
Division, Washington, D.C., at (614) 469-5715.
For additional comment contact Fred Alverson, Public
Affairs Officer at 614.469.5715. The Internet address
for the homepage for the United States Attorney's Office
for the Southern District of Ohio is www.usdoj.gov/usao/ohs.
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