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LOS ANGELES – A federal grand jury has indicted Los Angeles attorney Milton C. Grimes wiht the evasion of payment of his individual income taxes and willful failure to pay taxes, the Justice Department announced today. The indictment filed Thursday afternoon charges Grimes with one count of attempted tax evasion and four counts of willful failure to pay taxes.
March 22, 2024 — A federal grand jury has indicted Los Angeles attorney Milton C. Grimes with the evasion of payment of his individual income taxes and willful failure to pay taxes, the Justice Department announced today. … Los Angeles attorney charged with tax evasion and willful failure to pay over $2.4 million in taxes.
In the most recent indictment, federal prosecutors say Grimes owes the IRS more than $1.7 million in taxes for tax years 2010 and 2014. The IRS tried to co…2014 through 2023. The amount owed totaled $5,921,260, including tax, penalties, and interest owed to the IRS.Grimes also admitted he did not file a 2013 tax return with the IRS.
In addition to the federal tax evasion, Grimes admitted that he owed over $1,313,231 in delinquent state taxes to the Franchise Tax Board from 2014 to 2023.Beginning in September 2011,the IRS attempted to collect Grimes’ taxes by issuing more than 30 levies on his personal bank accounts. However, from at least May 2014 to April 2020, Grimes willfully evaded the payment of the outstanding income tax owed to the IRS by not depositing income he earned from his clients into his personal bank accounts that were subject to levy.
Instead, Grimes purchased approximately 238 cashier’s checks totaling $16 million to keep the money out of the reach of the IRS. Grimes woudl routinely purchase cashier’s checks and withdraw cash from his client trust account, his Interest on Lawyers’ Trust Accounts (IOLTA), and his law firm’s bank account, rather than pay the IRS.
Such as, on December 5, 2018, Grimes purchased nine cashier’s checks worth approximately $1,001,961, following the deposit of the same amount and on the same date into his IOLTA bank account.
IRS Criminal Examination investigated this matter.
Assistant United States Attorneys Valerie L. Makarewicz and Sarah S. Lee of the Major Frauds Section prosecuted this case.
Interview on Tax Evasion: Grimes’ Cashier’s Checks Scheme
Table of Contents
- Interview on Tax Evasion: Grimes’ Cashier’s Checks Scheme
- Editor: Could you explain how Grimes was able to hide $16 million using cashier’s checks?
- Editor: Why did Grimes resort to purchasing so many cashier’s checks?
- Editor: Can you provide an example of his method of operation?
- Editor: How did the IRS investigate this case?
- Editor: Who prosecuted the case against Grimes?
- Conclusion
Editor: Could you explain how Grimes was able to hide $16 million using cashier’s checks?
Guest: Grimes employed a sophisticated strategy to conceal his funds from the IRS. He orchestrated a series of transactions involving approximately 238 cashier’s checks totaling $16 million. By purchasing these cashier’s checks, Grimes effectively transferred money out of his bank accounts and into a form that could be concealed from tax authorities.
Editor: Why did Grimes resort to purchasing so many cashier’s checks?
Guest: Grimes was primarily trying to “keep the money out of the reach of the IRS.” Rather of paying his tax obligations, he routinely withdrew cash from his client trust accounts, Interest on Lawyers’ Trust Accounts (IOLTA), and his law firm’s bank account. The purchase of numerous cashier’s checks was a tactic to avoid reporting and paying his taxes.
Editor: Can you provide an example of his method of operation?
Guest: Certainly. On December 5, 2018, Grimes deposited $1,001,961 into his IOLTA account. The same day, he used these funds to purchase nine cashier’s checks worth the same amount. This pattern obscured the source of funds and prevented the IRS from tracing the money directly to his tax obligations.
Editor: How did the IRS investigate this case?
Guest: The IRS Criminal Examination division meticulously investigated this matter. Their exhaustive examination uncovered Grimes’ dodging tactics and brought his actions to the attention of law enforcement.
Editor: Who prosecuted the case against Grimes?
Guest: The prosecution was led by Assistant United States attorneys Valerie L. Makarewicz and Sarah S. Lee of the Major Frauds Section. Their diligent work ensured that Grimes’ fraudulent activities where brought to justice.
Conclusion
This detailed exploration of Grimes’ tax evasion tactics highlights the lengths individuals may go to avoid their tax obligations. The IRS and prosecution teams played crucial roles in uncovering and addressing these deceptive practices.This interview underscores the importance of meticulous financial monitoring and adherence to tax laws to maintain societal trust and fair financial practices.
