.~---- UNITED STATES DISTRICT. June 2 O O 1 Grand Jury UNITED STATES OF AMERICA, .Plaintiff,

Transcription

1 , - ~ '... ~ ('.'',... -._ ' ~.\,,..., \: ',,I.,. i.~---- UNITED STATES DISTRICT COURT FOR THE CENTRAL DISTRICT OF CALIFORNIA UNITED STATES OF AMERICA,.Plaintiff, v. ALMON GLENN BRASWELL, ROBERT BRUCE MILLER, and WILLIAM E. FRANTZ, Defendants. The Grand Jury charges: GENERAL ALLEGATIONS June O O 1 Grand Jury At all times material to this indictment: The Defendants ) ~R 0G. l - 1 ',:' ) ) I N D I C T M E N T ) ) [ U.S.C. 1: Conspiracy; ) U.S.C. 01: Tax Evasion; ) u.s.c. 0 (1): ) Subscribing To False Return] ) ) ) ) 1. Defendant ALMON GLENN BRASWELL ("BRASWELL") was the sole shareholder of a number of affiliated corporations, including (a) a California corporation, G.B. Data Systems, Inc. ("GBDS") and (b) a Florida corporation, Gero Vita International, Inc. ( "GVI"). BRASWELL maintained a residence and office in Los Angeles, California.

2 . Defendant ROBERT BRUCE MILLER ("MILLER") was a certi.f ied public accountant who maintained offices in Los Angeles, California. Defendant MILLER prepared corpo~ate tax returns for GBDS and GVI.. Defendant WILLIAM E. FRANTZ ("FRANTZ'') was a tax attorney and a partner in Frantz, Sanders & Grattan, LLP ("FS&G"), a law firm that maintained offices in Atlanta, Georgia. Defendant FRANTZ prepared personal tax returns for defendant BRASWELL. IO GBDS' and GVI's Business and Accounts. GBDS, GVI and BRASWELL's other affiliated corporations 1 (collectively, "the Affiliated Corporations") maintained integrated offices, including accounting and purchasing 1 departments, in Los Angeles, California. The Affiliated Corporations' bank accounts were maintained in GBDS' name, and the Affiliated Corporations' employees' wages were paid through GBDS.. GBDS and GVI were engaged in the business of selling nutritional supplements, by mail, to the public. GVI acquired 0 the nutritional supplements by: (a) purchasing herbal products and other raw materials from third-party vendors (the "Raw Material Suppliers") ; and (b) contracting with co-packers or laboratories (the "Manufacturers") to have the raw materials combined and processed into finished goods. The Raw Material Suppliers and Manufacturers were located in the United States, Canada and, in one instance, Spain. None of them were located in Bermuda..

3 1. GBDS maintained a number of corporate bank accounts, including (a) an account at the Bank of America in Las Vegas, Nevada (the "Bank of America Account") and (b) an account at the Royal Bank of Canada in Toronto, Canada (the "Royal Bank of Canada Account"). BRASWELL's and FRANTZ' Use of the FS&G Account for BRASWELL's Personal Benefit. FRANTZ' law firm, FS&G, maintained a bank account at Fidelity National Bank in Atlanta, Georgia (the "FS&G Account"). BRASWELL periodically caused GBDS' accounting personnel to transfer funds from GBDS' bank accounts to the FS&G account. In 1 geperal, GBDS' accounting personnel recorded the transfers on GBDS' and the Affiliated Corporations' books and records as 1 corporate investments.. Through FRANTZ, BRASWELL periodically used the funds in the FS&G Account for his own personal benefit, without disclosing the amounts or the purposes of the disbursements to GBDS' accounting personnel. As a result, BRASWELL and FRANTZ generally were able to disburse monies from the FS&G Account without the 0 disbursements or BRASWELL's personal use of the monies being l shown on GBDS' or the Affiliated Corporations' books and records. BRASWELL's Sham Bermuda Corporation and Off-Shore Accounts. Vita International, Ltd. ("Vita") was a Bermuda corporation that BRASWELL beneficially owned and controlled.. On or about January,, at FRANTZ' and BRASWELL's request, Vita's name was changed to Deleon Global Trading, Ltd. ( "Deleon" ).

4 . The affairs of Deleon were managed by a Bermuda management company, Hemis~here Management, Ltd. ("Hemisphere"), that was in the business of establishing and managing off-shore corporations and accounts for its clients. Deleon itself did not conduct any business, did not have any employees and did not maintain offices, in Bermuda, or elsewhere. 1. Hemisphere managed a number of bank accounts outside the United States on BRASWELL's behalf, including an account in Deleon's name at the Bank of Bermuda in Hamilton, Bermuda and an account in BRASWELL's name at the Bank of Butterfield, in the Cayman Islands (collectively, "the Offshore Accounts"). 1. FRANTZ was BRASWELL's sole agent and authorized representative for purposes of providing instructions to 1 Hemisphere regarding the management of Deleon and the Offshore Accounts. GVI's and BRASWELL's Tax Returns 1. Every year, GVI filed U.S. Corporation Income Tax Returns that purported, among other things, to disclose the true l costs that GVI had incurred in purchasing raw materials and o having them manufactured into finished products that could be sold to the public. The tax returns treated these costs, known as "cost of goods sold," as deductible business expenses.. Every year, BRASWELL filed U.S. Individual.Income Tax Returns that purported, among other things, to disclose all of the income that he had received during the applicable tax year, including all income that he had received from GBDS and vr.

5 1 The False Expense Scheme: BRASWELL's and MILLER's Use of Deleon to Claim False Business Expenses on GVI's Corporate Income Tax Returns. As set forth in more detail below, between on or about December, and on or about June,, BRASWELL and MILLER used Deleon's name to create false expenses on GVI's books and records. Among other things: MILLER created fictitious invoices and false expense entries on GVI's books and records; BRASWELL and MILLER caused GVI's purchasing personnel to order herbal supplements and other raw materials from the Raw Material Suppliers in Deleon's, rather than GVI's, name; and BRASWELL and 1 MI~LER caused GBDS' ahd GVI's accounting personnel to post fabricated expenses based on purported orders to Deleon for 1 "nutritional supplements" and other "health care products.". The purpose of this conduct was to make it appear, on paper, as if Deleon was a legitimate supplier that had charged l GVI millions of dollars for "nutritional supplements" and other "health care products," even though Deleon was not a supplier, was not in the business of selling products, and had not sold any 0 products to GVI.. MILLER and BRASWELL caused the fabricated expenses to be reported as cost of goods sold on GVI's corporate tax returns, thus enabling GVI to evade millions.of dollars in taxes. I I I I I I

6 The Income Diversion Scheme: BRASWELL's and FRANTZ' Use of the FS&G Account and the Offshore Accounts to Conceal Millions of Dollars in Income. As set forth in more detail below, between on or about November 0, and on or about December,, BRASWELL caused GBDS to transfer millions of dollars to the FS&G Account and the Offshore Accounts for his own personal use, including approximately $,, that was deposited into the ac~ount in Deleon's name at the Bank of Bermuda in purported payment of the lo fabricated expenses that GVI appeared, on paper, to have incurred as a result of making the Deleon purchases. i 0. FRANTZ failed to report the transfers as income on BRASWELL's Individual U.S. Income Tax Returns, thus enabling l BRASWELL to evade millions of dollars in taxes. 0

7 '\ 1 A. PRELIMINARY ALLEGATIONS COUNT ONE [ u.s.c. 1] The grand jury realleges paragraphs 1 through 0 of the General Allegations set forth above. B. OBJECT OF THE CONSPIRACY Beginning on or about December, and continuing through on or about June,, in Los Angeles County, within the Central District of California, and elsewhere, defendants BRASWELL and MILLER did willfully and knowingly conspire and agree with each other to commit offenses against the United 1 'St~tes, namely: to defraud the United States by impeding, impairing, obstructing, and defeating the lawful government l functions of the Internal Revenue Service of the Treasury l Department by deceit, craft, trickery, or means that are dishonest in the ascertainment, computation, assessment, and collection of revenue, to wit, income taxes, through the l preparation and filing of federal corporate income tax returns fo~ GVI which falsely stated that GVI had incurred cost of goods 0 sold expenses arising from purchases from Deleon which were entirely fictitious. C. MEANS BY WHICH THE OBJECT OF THE CONSPIRACY WAS TO BE ACCOMPLISHED The manner and means by which the conspiracy was to be accomplished included the following: 1. BRASWELL and MILLER would cause GVI's and GBDS' purchasing personnel to order the herbal products and other raw

8 1 materials that GVI was acquiring from the Raw Material Suppl_iers in Deleon's name (the "Deleon Purchase Ordersll).. BRASWELL would cause GVI's and GBDS' purchasing personnel to send copies of the Deleon Purchase Orders to Hemisphere.. BRASWELL would cause Hemisphere to (a) issue bank drafts against the account in Deleon's name at the Bank of Bermuda, made payable to the Raw Material Suppliers, and (b) send the drafts to BRASWELL.. BRASWELL would deliver the drafts to GVI's and GBDS' purchasing personnel, in Los Angeles, so that the drafts could be delivered to the Raw Material Suppliers in payment of the Deleon 1 Pu;rchase Orders.. BRASWELL and MILLER would c~use GVI's and GBDS' 1 purchasing personnel to send MILLER summaries of the Deleon Purchase Orders that listed the names of the Suppliers, the.nature and amounts of the raw materials that GVI had ordered, and the true purchase prices.. Based on the summaries, MILLER would prepare invoices in Deleon's name that purported to bill GVI for "nutritional 0 supplementsll and other "health care productsn (the "Fraudulent Invoices").. The Fraudulent Invoices would purport to charge GVI from two to ten times the amounts that the Raw Material Suppliers had actually charged for the herbal products and other Raw Materials that GVI had ordered {the "Marked Up Chargesn).. MILLER and BRASWELL would cause GBDS' and GVI's accounting personnel to post the Marked Up Charges to expense

9 1 accounts in GVI's general ledgers.. BRASWELL would periodically cause GBDS' and GVI's accounting personnel to issue checks to Deleon, care of Hemisphere, in order to pay the Fraudulent Invoices, even though: (a) GVI had not purchased any products from Deleon; and (b) the Marked Up Charges had been fabricated.. MILLER would prepare adjusting journal entries to GVI's general ledger in order to re-classify non-deductible transfers to Deleon that had been classified as "investments," as deductible cost of goods sold expenses.. MILLER would prepare GVI's federal corporate tax 1 re~urns. In preparing the returns, MILLER would include false deductions for the fabricated cost of goods sold that GVI had 1 purportedly incurred as a result of the fictitious purchases from Deleon. 1. BRASWELL would sign the returns and cause them to be filed with the Internal Revenue Service. D. OVERT ACTS In furtherance of the conspiracy and to accomplish the 0 object of the conspiracy, the following overt acts were committed in the Central District of California and elsewhere: 1. On or about December,, BRASWELL caused GBDS to. issue a check in the amount of $00,000 to Deleon.. On or about January,, BRASWELL caused GBDS to issue a check in the amount of $00,000 to Deleon.. On or about January 0,, BRASWELL caused GBDS to issue a check in the amount of $00,000 to Deleon.

10 . On or about January,, BRASWELL caused GBDS to issue a check in the amount of $00,000 to Deleon. S. On or about May,, BRASWELL caused GBDS to issue a check in the amount of $0,000 to Deleon.. On or before June,, MILLER prepared an adjusting journal entry to GVI's books and records that falsely stated that during the fiscal year ending September 0,, Deleon had charged GVI a "manufacturing fee," totaling $,,0.. On or before June,, MILLER prepared an adjusting journal entry to GVI's books and records in order to re-classify $1,0,000 in assets, that previously had been recorded as an 1 investment, as an expense.. On or about June,, MILLER prepared a U.S. 1 Corporation Income Tax Return, Form 0, for GVI for the fiscal year ending September 0, (the " Return"), which l included a false deduction of approximately $,, based on fabricated cost of goods sold expenses resulting from GVI's fictitious purchases from Deleon.. On or about June,, BRASWELL signed the 0 Return on behalf of GVI.. On or before September,, MILLER prepared approximately invoices in the name of Deleon that purported to charge GVI approximately $1,0, for nutritional supplements and health care products that GVI had purportedly purchased from Deleon.. On or about September,, BRASWELL caused GBDS to issue a check in the amount of $1,0, to Deleon.

11 On or about October,, BRASWELL caused GBDS to issue a check in the amount of $,00 to Deleon.. On or about November 1,, BRASWELL caused GBDS to issue a check in the amount of $1,,0 to Deleon. 1. On or about November,, MILLER caused GVI to reclassify $,00,000 of GVI' s assets, that previously had been recorded as an investment, as an expense.. On or about November 0,, BRASWELL caused GBDS to issue a check in the amount of $,000 to Deleon.. On or before January,, MILLER prepared an adjusting journal entry to GVI's general ledger that increased GV~'s "inventory usage" expense account by approximately $,1,000.. On or before January,, MILLER prepared an adjusting journal entry to GVI's general ledger that decreased GVI's "inventory usage" expense account by approximately $1,,00.. On or about January,, MILLER prepared a U.S. Corporation Income Tax Return, Form 0, for GVI for the fisc~l year ending September 0, (the " Return"), which included a false deduction of approximately $,, based on fabricated cost of goods sold expenses resulting from GVI's fictitious purchases from Deleon.. On or about January,, BRASWELL signed the Return on behalf of GVI. 0. On or about February,, BRASWELL caused GBDS to issue a check in the amount of $,. to Deleon.

12 1 IO 1. On or before February 1,, MILLER prepared approximately invoices in the name of Deleon that purported to charge GVI approximately $,0,. for "nutritional supplements" and "health care products" that GVI had purportedly purchased from Deleon.. On or about February 1,, BRASWELL caused GBDS to issue a check in the amount of $1,,.0 to Deleon.. On or about March,, BRASWELL caused GBDS to issue a check in the amount of $0, to Deleon.. On or about March, BRASWELL caused GBDS to issue a check in the amount of $1,,0. to Deleon.. On or about June,, MILLER purchased a set of blank three-part invoices in the name of Deleon

13 COUNT TWO [ U.S. C. 01] Between on or about December, and on or about June,, in Los Angeles County, in the Central District of California, defendants ALMON GLENN BRASWELL ("BRASWELL") and ROBERT BRUCE MILLER ("MILLER") did willfully attempt to evade and defeat the assessment of a substantial part of the federal corporate income taxes due and owing by Gero Vita International, Inc. ("GVI") for the fiscal year ending September 0,, in the amount of approximately $1,,, by committing the following acts, among others: (1) on or before June,,.MILLER prepared an adjusting journal entry to GVI's books and 1 records that falsely stated that during the fiscal year ending September 0,, Deleon Global Trading Ltd. ("Deleon") had charged GVI a "manufacturing fee," totaling $,,0; () on br before June,, MILLER prepared an adjusting journal entry to GVI's books and records in order to.re-classify approximately $1,0,000 in assets, that previously had been recorded as an investment, as an expense; () on or about June,, MILLER prepared a U.S. Corporation Income Tax Return, Form 0, for GVI for the fiscal year ending September 0, (the " Return") that purported to truthfully report all of the deductible business expenses that GVI had incurred during the fiscal year; () on or about June,, BRASWELL signed the Return; and () BRASWELL and MILLER willfully over-stated the amount of the deductible business expenses that GVI had incurred by approximately $,,0 on the Return, resulting in an

14 1 under-statement of the tax due and owing of approximately $1,,

15 ' COUNT THREE ( u.s.c. 01] Between on or about January, and on or about February 1,, in Los Angeles County, in the Central District of California, defendants ALMON GLENN BRASWELL ("BRASWELL") and ROBERT BRUCE MILLER ("MILLER") did willfully attempt to evade and defeat the assessment of a substantial part of the federal corporate income taxes due and owing by Gero Vita International, Inc. ("GVI") for the fiscal year ending September 0,, in the amount of approximately $,1,, by committing the fo_llowing acts, among others: (1) Between on or about January, ~ and on or about November 0,, BRASWELL caused G.B. Data Systems, Inc. ("GBDS") to issue approximately checks payable to Deleon Global Trading, Ltd. ("Deleon"), totaling approximately $,,0 to pay Deleon for raw materials that GVI had purportedly purchased from Deleon; () on or before September,, MILLER prepared approximately invoices in the name of Deleon that purported to charge GVI approximately $1,0, for "nutritional supplements" and "health care products" that GVI had purportedly purchased from Deleon; () on or about November,, MILLER caused GVI to reclassify approximately $,00,000 of GVI' s asset_s, that previously had been recorded as an investmen~, as an expense; () on or before January,, MILLER prepared an adjusting journal entry to GVI's general ledger that increased GVI's "inventory usage" expense account by approximately $,1,000; () on or before January,, MILLER prepared an adjusting journal entry to GVI's general ledger that decreased

16 1 1 1 GVI's "inventory usage" expense account by approximately $1,,00; () on or about January,, MILLER prepared a U.S. Corporation Income Tax Return, Form 0, for GVI for the fiscal year ending September 0, (the " Return") ; () on or about January,, BRASWELL signed the Return on behalf of GVI; () on or about February,, BRASWELL caused GBDS to issue.a check in the amount of approximately $,. to Deleon; () on or before February 1,, MILLER prepared approximately invoices in the name of Deleon that purported to charge GVI approximately $,0,. for "nutritional supplements: and "health are products" that GVI had purpor~edly pu~chased from Deleon; () on or about February 1,, BRASWELL caused GBDS to issue a check in the amount of $1,,.0 to Deleon; and () BRASWELL and MILLER willfully over-stated the amount of the deductible business expenses that GVI had incurred by approximately $,, on the Return, resu_lting in an under-statement of the tax due and owing of approximately $,1,. 0

17 COUNT FOUR ( u.s.c. 1] A. PRELIMINARY ALLEGATIONS The grand jury re.alleges paragraphs 1 through o of the General Allegations set forth above. B. OBJECT OF THE CONSPIRACY Beginning on or about November 0, and continuing through on or about October,, in Los Angeles County, within the Central District of California, and elsewhere, defendants BRASWELL and FRANTZ did w~llfully and knowingly conspire and agree with each other to commit offenses against the Un,ited States, namely to defraud the United States by impeding, impairing, obstructing, and defeating the lawful government functions of the Internal Revenue Service of the Treasury Department by deceit, craft, trickery, or means that are dishonest in the ascertainment, computation, assessment, and collection of revenue, to wit, income taxes, through the preparation and filing of U.S. Individual Income Tax Returns for BRASWELL which would fail to report income that BRASWELL received from GBDS in the form of transfers by GBDS of corporate funds to the FS&G Account and the Offshore Accounts for BRASWELL's personal benefit. C. MEANS BY WHICH THE OBJECT OF THE CONSPIRACY WAS TO BE ACCOMPLISHED The manner and means by which the conspiracy was to be accomplished included the following: 1. BRASWELL would cause GBDS' and GVI's accounting

18 '. 1 IO p ersonnel to transfer funds from GBDS' bank accounts to the FS&G Account. GBDS' and GVI's accounting personnel would record the transf.ers on GBDS' and the Affiliated Corporations' books and records as corporate assets or investments.. BRASWELL would cause GBDS' and GVI's accounting personnel to issue checks on the Royal Bank of Canada Account, payable to Deleon, care of Hemisphere. BRASWELL and FRANTZ would cause Hemisphere to deposit the checks into the account in Deleon's name at the Bank of Bermuda.. FRANTZ would periodiqally cause checks to be issued from the FS&G account for BRASWELL's personal benefit, even though the account had been funded with GBDS', GVI's and the Affiliated I Corporations' corporate funds.. FRANTZ would prepare BRASWELL's U.S. Individual Income Tax Returns. In preparing the returns, FRANTZ would fail to include the amounts that: (a) had been paid for BRASWELL's benefit from the FS&G account; and (b) had _been deposited for BRASWELL'S benefit into the account in Deleon's name at the Bank of Bermuda.. BRASWELL would sign the returns and cause them to be filed with the Internal Revenue Service. D. OVERT ACTS In furtherance of the conspiracy and to accomplish the object of the conspiracy~ the following overt acts were committed in the Central District of California and elsewhere: 1. On or about November 0,, FRANTZ caused a check in the amount of $00,000 to be issued from the FS&G account payable

19 to the order of "Hemisphere Trust Co." for deposit into an account in the name of Vita at the Bank of Bermuda.. On or about January,, BRASWELL caused GBDS to transfer account. $00,000 from its Bank of America account to the FS&G. On or about January,, BRASWELL and FRANTZ caused the name of Vita International, Ltd. to be changed to Deleon Global Trading, Ltd. - On or about January,, BRASWELL caused GBDS to transfer approximately $00,000 from its Bank of America Account to the FS&G account.. On or about January 0,, BRASWELL caused GBDS to transfer approximately $00,000 from its Bank of America Acc.ount to the FS&G account.. On or about January,, FRANTZ caused a check in the amount of $00,000 to be issued from the FS&G account, payable to the Internal Revenue Service.. On or about January,, BRASWELL caused GBDS to transfer approximately $00,000 from its Bank of America Account to the FS&G account.. On or about January 1,, FRANTZ caused a check in the amount of $1,000,000 to be issued from the FS&G Account to the Bank of Butterfield for deposit into BRASWELL's personal account.. On or about August,, FRANTZ caused $1,000,000 to be transferred from the FS&G account to the Bank of Butterfield for deposit into BRASWELL's personal account.

20 On or about December,, BRASWELL caused GBDS to issue a check in the amount of $00,000 to Deleon.. On or about January,, BRASWELL caused GBDS to issue a check in the amount of $00,000 to Deleon. 1. On or about January 0,, BRASWELL caused GBDS to issue a check in the amount of $00,000 to Deleon.. On or about January,, FRANTZ caused a check in the amount of $0,000 to be issued from the FS&G Account for BRASWELL's personal benefit. 1. On or about January,, BRASWELL caused GBDS to issue a check in the amount of $00,000 to Deleon.. On or about May,, BRASWELL caused GBDS to issue a check in the amount of $0,000 to Deleon.. On or about September,, BRASWELL caused GBDS to transfer $00,000 to the FS&G Account.. On or about September,, FRANTZ -caused a check. in the amount of $00,000 to be issued from the FS&G Account for BRASWELL's personal benefit.. On or about September,, BRASWELL caused GBDS to issue a check in the amount of $1,0, to Deleon.. On or about October,, FRANTZ prepared an Individual U.S. Income Tax Return for BRASWELL for (the " Return"), which failed to report app_roximately $,,000 of taxable income that BRASWELL had received in. 0. On or about October,, BRASWELL signed the Return and caused it to be filed with the Internal Revenue Service.. 0

21 On or about October,, BRASWELL caused GBDS to issue a check in the amount of $,00 to Deleon.. On or about November 1,, BRASWELL caused GBDS to issue a check in the amount of $1,,0 to Deleon.. On or about November 0,, BRASWELL caused GBDS to issue a check in the amount of $,000 to Deleon.. On or about January,, BRASWELL caused GBDS to transfer $00,000 to the FS&G Account.. On or about January,, FRANTZ caused a check in the amount of $0,000 to be issued from the FS&G Account for B~SWELL's personal benefit.. On or about February,, BRASWELL caused GBDS to issue a check in the amount of $,. to Deleon.. On or about February 1,, BRASWELL caused GBDS to issue a check in the amount of $1,,.0 to Deleon.. On or about October,, FRANTZ prepared an Individual U.S. Income Tax Return for BRASWELL for (the " Return"), which failed to report approximately $,,0 of taxable income that BRASWELL had received in.. On or about October,, FRANTZ signed the Return on BRASWELL's behalf and caused it to be filed with the Internal Revenue Service. 0. On or about March,, BRASWELL caused GBDS to issue a check in the amount of $0, to Deleon. 1. On or about March,, BRASWELL caused GBDS to issue a check in the amount of $1,,0. to Deleon.. On. or about April,, BRASWELL caused GBDS to

22 issue a check in the amount of $00,000 to the FS&G Account.. On or about May,, FRANTZ caused a check in the amount of $0,000 to be issued from the FS&G Account for BRASWELL's personal benefit.. On about October, FRANTZ caused an individual at FS&G to sign a U.S. Individual Income Tax Return for BRASWELL for (the " Return"), which failed to report approximately, $,,0 of taxable income that BRASWELL had received in.. On or about October,, BRASWELL signed the Return and caused it to be filed with the Internal Revenue Service.. On or before November,, BRASWELL used approximately $,00,000 that had been deposited into the account in Deleon's name at the Bank of Bermuda, to purchase a personal residence in Coconut Grove, Florida.. On or about March,, FRANTZ told an Internal Revenue Service International Examiner that BRASWELL did not own Deleon and that he (FRANTZ) had not been able to obtain written information from Hemisphere regarding Deleon's ownership.. On or about October,, FRANTZ prepared an Individual U.S. Income Tax Return for BRASWELL for (the " Return"), which failed to report approximately $.,, of taxable income that BRASWELL had received in.. On or about October,, BRASWELL signed the Return and caused it to be filed with the Internal Revenue Service.

23 COUNT FIVE [ u.s.c. 01] Between on or about January, and on or about December,, in Los Angeles County, in the Central District of California, and elsewhere, defendants ALMON GLENN BRASWELL ("BRASWELL") and WILLIAM E. FRANTZ ("FRANTZ") did willfully attempt to evade and defeat the assessment of a substantial part of the federal individual income taxes due and owing by BRASWELL for, in the amount of approximately $,, by committing the following acts, among others: (1~ between January, and September 0,, BRASWELL caused G.B. Data Systems, Inc. ("GBDS") to transfer-approximately $,00,000 to an account in the name of Frantz, Sanders & Grattan, LLP (the "FS&G Account"); (} between January, and August,, FRANTZ caused approximately $,000,000 to be transferred from the FS&G account to BRASWELL's personal account at the Bank of Butterfield, in the Cayman Islands; () Between January, and December,, FRANTZ caused checks totaling approximately $1,,000 to be issued from the FS&G Account to the Internal Revenue Service, to be applied to BRASWELL's personal tax liability; () on or about December,, BRASWELL caused GBDS to issue a check in the amount of $00,000 on GBDS' account at the Royal Bank of Canada to Deleon, care of Hemisphere Management Co.; () on or about October,, FRANTZ prepared an Individual U.S. Income Tax Return for BRASWELL for. (the " Return") that failed to report or include in BRASWELL's taxable income the amounts that had been paid to the Internal Revenue Service, Deleon and

24 1 the Bank of Butterfield; () On or about October,, BRASWELL signed the Return and caused it to be filed with the Internal Revenue Service; and {) BRASWELL and FRANTZ willfully under-stated BRASWELL's taxable income on the Return by approximately $,,000, the amounts set forth above that had been paid to the Internal Revenue Service, Deleon and the Bank of Butterfield, resulting in an under-statement of the tax due and owing of approximately $,,

25 COUNT SIX 1 [ u.s.c. 01] Between on or about January, and on or about October,, in Los Angeles County, in the Central District of California, and elsewhere, defendants ALMON GLENN BRASWELL ("BRASWELL") and WILLIAM E. FRANTZ ("FRANTZ") did willfully attempt to evade and defeat the assessment of a substantial part of the federal individual income taxes due and owing by BRASWELL for, in the amount of approximately $,,0, by IO committing the following acts, among others: (1) Between on or about January, and on or about November 0,,.B~SWELL caused approximately $,,0 to be transferred from an account in the name of G. B. Data Systems, Inc. ( "GBDS") a.t the Royal Bank of Canada to an account in the name of Deleon Global Trading, Ltd. at the Bank of Bermuda, in Hamilton, Bermuda) (the " Deleon Deposits"); () between on or about March, and on or about September,, BRASWELL caused GBDS to transfer approximately $,00,000 to an account in the name of Frantz, Sanders & Grattan, LLP (the "FS&G Account"); () betw~en on or about January, and on or about October,, FRANTZ caused checks totaling approximately $1,, to be issued from the FS&G Account to the Internal Revenue Service, to be applied to BRASWELL's personal tax liability (the " Transferred Funds"); () on or about October, FRANTZ prepared an Individual U.S. Income Tax Return for BRASWELL for (the " Return") that failed to report the Deleon Deposits or the Transferred Funds or to include them in

26 BRASWELL's taxable income; () on or about October,, FRANTZ signed the Return on BRASWELL's behalf and caused it to be filed with the Internal Revenue Service; () BRASWELL and FRANTZ willfully under-stated BRASWELL's taxable income on the Return by approximately $,,0, the amounts of the Transferred Funds and the Deleon Deposits, resulting in an under-statement of the tax due and owing of approximately $,,

27 COUNT SEVEN ( u.s.c. 01] Between on or about February, and on or about October,, in Los Angeles County, in the Central District of California, and elsewhere, defendants ALMON GLENN BRASWELL ("BRASWELL") and WILLIAM E. FRANTZ ("FRANTZ") did willfully attempt to evade and defeat the assessment of a substantial part of the federal individual income taxes due and owing by BRASWELL for, in the amount of approximately $1,,0, by committing the following acts, among others: (1) Between on or abut February, and February 1,, BRASWELL caused ap,proximately $,0,. to be transferred from an account in the name of G.B. Data Systems, Inc. ("GBDS") at the Royal Bank of Canada to an account in the name of Deleon Global Trading Ltd. ("Deleon")at the Bank of Bermuda, in Hamilton, Bermuda (the " Deleon Deposits") ; {) between on or about January, and on.or about June,, BRASWELL caused GBDS to transfer approximately $,00,000 to an account in the name of Frantz, Sanders & Grattan, LLP (the "FS&G Account"); () Between on or about January, and on or about September 0,, FRANTZ caused checks totaling approximately $,0,000 to be issued from the FS&G Account to the Internal Revenue Service to be applied to BRASWELL's personal tax liability and to an account in BRASWELL's name at the Bank of Butterfield in the Cayman Islands (the " Transferred Funds"); (} 'on or about October, FRANTZ caused an Individual U.S. Income Tax Return for BRASWELL for (the " Return"} to be prepared by another individual at

28 ._,., FRANTZ' law firm, that failed to report the Deleon Deposits or the Transferred Funds or include them in BRASWELL's taxable income; () on or about October,, BRASWELL signed the Return and caused it to be filed with the Internal Revenue Service; () BRASWELL and FRANTZ willfully under-stated BRASWELL's taxable income on the Return by approximately $,,0, the amounts of the Transferred Funds and the Deleon Deposits, resulting in an under-statement of the tax due and owing of approximately $1,,

29 -. 1 IO COUNT EIGHT [ u.s.c. 01] Between on or about March, and on or about October,, in Los Angeles County, in the Central District of California, and elsewhere, defendants.almon GLENN BRASWELL ("BRASWELL") and WILLIAM E. FRANTZ ("FRANTZ") did willfully attempt to evade and defeat the assessment of a substantial part of the federal individual income taxes due and owing by BRASWELL for, in the amount of approximately $1,0,, by committing the following acts, among _others: (1) on or about M~rch, BRASWELL caused approximately $,00,. to be transferred from an account in the name of G.B. Data Systems, Inc. ("GBDS") at the Royal Bank of Canada to an account in the name of Deleon Global Trading, Ltd. ("Deleon") at the Bank of Bermuda, in Hamilton, Bermuda (the " Deleon Deposits"); () between on or about April, and on or about December,, BRASWELL caused GBDS to transfer approximately $1,00,000 to an account in the name of Frantz, Sanders & Grattan, LLP {the "FS&G Account"); () Between on or about January, and December,, FRANTZ caused checks totaling approximately $,-,000 to be issued from the FS&G Account to the Internal Revenue Service, to be applied to BRASWELL's personal tax liability {the " Transferred Funds"); {) on or about October,, FRANTZ prepared an Individual U.S. Income Tax Return for BRASWELL for (the " Return") that failed to report the Deleon Deposits or the Transferred Funds or include them in BRASWELL's taxable income; {) on or about October,

30 1, BRASWELL signed the Return and caused it to be filed with the Internal Revenue Service; () BRASWELL and FRANTZ willfully under-stated BRASWELL's taxable income on the Return by approximately $,,. the amounts of the Transferred Funds and the Deleon Deposits, resulting in an under-statement of the tax due and owing of approximately $1,0,

31 COUNT NINE [ u.s.c. 0(1)] On or about June,, in Los Angeles County, within the Central District of California, defendant ALMON GLENN BRASWELL ("BRASWELL"}, did willfully make and subscribe to a United States Corporation Income Tax Return, Form 0, of Gero Vita International, Inc. ("GVI"} for the fiscal year ending September 0,, which was verified by a written declaration that it was made under the penalties of perjury and was filed with the Internal Revenue Service and which he did not believe to be true and correct as to every material matter contained therein, in.that 1, the tax return reported that GVI had incurred cost of goods sold of $1,,, whereas, as BRASWELL then well knew and. 1 believed, the reported cost of goods sold figure included substantial amounts that GVI neither paid nor incurred in the fiscal 0 year ending September 0,. 1

32 I 1 1 COUNT TEN [ U.S.C. 0(1)] On or about January,, in Los Angeles County, within the Central District of California, defendant ALMON GLENN BRASWELL ("BRASWELL") did willfully make and subscribe to a United States Corporation Income Tax Return, Form 0, of Gero Vita International, Inc. ("GVI") for the fiscal year ending September 0,, which was verified by a written declaration that it was made under the penalties of perjury and was filed with the Internal Revenue Service and which he did not believe to be true and correct as to every material matter contained th,erein, in that the tax return reported that GVI had incurred cost of goods sold of $,,, whereas, as BRASWELL then well knew and believed, the reported cost of goods sold figure included substantial amounts that GVI neither paid nor incurred in the fiscal year endi.ng September 0,. 0.

33 I 1 1 COUNT ELEVEN ( u.s.c. 0(1)) On or about October,, in Los Angeles County, within the Central District of California, defendant ALMON GLENN BRASWELL {"BRASWELL") did willfully make and subscribe to a United States Income Tax Return, Form 0, for the taxable year, which was verified by a written declaration that it was made under the penalties of perjury and was filed with the Internal Revenue Service and which he did not believe to be true and correct as to every material matter contained therein, in t~at the tax return reported that BRASWELL's total income for was $,,, whereas, as BRASWELL then well knew and believed, the reported total income figure did not include income that BRASWELL received in, by causing one of his corporations, G.B. Data Systems, Inc., to transfer funds to an attorney escrow account and offshore accounts for BRASWELL's personal benefit. 0

34 COUNT TWELVE 1 ( u.s.c. 0(1)] On or about October,, in Los Angeles County, within the Central District of California, defendant ALMON GLENN S BRASWELL ("BRASWELL") did wi fully make and subscribe to a United States Income Tax Return, Form 0, for the taxable year, which was verified by a written declaration that it was made under the penalties of perjury and was filed with the Internal Revenue Service and which he did not believe to be true and correct as to every material matter contained therein, in that the t~x return reported that BRASWELL's total income for was $,,, whereas, as BRASWELL then well knew and believed, the reported total income f~gure did not include income that BRASWELL received in by causing one of his corporations, G.B. Data Systems, Inc., to transfer funds to an attorney escrow account and offshore accounts for BRASWELL's personal benefit.

35 1 COUNT THIRTEEN [ u.s.c. 0(1}] On or about October,, in Los Angeles County, within the Central District of California, defendant ALMON GLENN S BRASWELL ("BRASWELL"} did willfully make and subscribe to a United States Income Tax Return, Form 0, for the taxable year, which was verified by a written declaration that it was made under the penalties of perjury and was filed with the Internal Revenue Service and which he did not believe to be true and correct as to every material mat~er contained therein, in that the tax return rep~rted that BRASWELL's total income for 1, was $,1,, whereas, as BRASWELL then well knew and 1 believed, the reported total income figure did not include income that I I I I I I 0 I I II BRASWELL received in by causing one of his corporations, G.B. Data Systems, Inc., to transfer funds to an II II II II II II

36 ,. attorney escrow account and offshore accounts for BRASWELL's personal benefit. A TRUE BILL Foreperson DEBRA W. YANG United States Attorney JACQUELINE CHOOLJIAN, IO Assistant United States Attorney Chief, Criminal Division 1 LAWRENCE MIDDLETON Assistant United States Attorney Chief, Public Corruption and Government Fraud Section 1 0