And the latest celebrity IRS target is...

[Owensdad]

Helio Castroneves!arty

Race driver Castroneves charged in US tax case
By CURT ANDERSON – 54 minutes ago

MIAMI (AP) — Two-time Indianapolis 500 winner and TV "Dancing With The Stars" champion Helio Castroneves was indicted Thursday on tax evasion and tax fraud charges, accused of using offshore accounts to hide millions of dollars in income from the Internal Revenue Service.

Castroneves, 33, is charged with conspiracy and six counts of tax evasion for purportedly failing to report to the IRS about $5.5 million in income between 1999 and 2004, according to court documents. Each count carries a maximum five-year prison sentence.

Also facing charges are Katiucia Castroneves, 35, the race car driver's sister and business manager, and attorney Alan R. Miller, 71, of Birmingham, Mich. All three are scheduled to make court appearances Friday and it wasn't immediately clear if they had hired defense lawyers. None were under arrest Thursday.

"This case sends a clear message that the IRS is committed to vigorously enforcing the tax laws and stopping offshore tax evasion," said IRS Commissioner Doug Shulman.

Castroneves, a native of Sao Paulo, Brazil, has won the Indianapolis 500 twice and is currently second in the IndyCar Series points standings. He and partner Julianne Hough won the 2007 "Dancing With The Stars" TV reality show competition on ABC.

The indictment charges that Castroneves illegally concealed income from Penske Racing Inc. and the Brazilian firm Coimex International S.A. Neither company is charged with any wrongdoing.

In Penske's case, prosecutors say Castroneves was to be paid $5 million in exchange for rights to use his name, likeness and image. The money was initially supposed to go to a Panamanian shell corporation, but then was diverted to a Dutch entity called Fintage Licensing.

Fintage was set up as a "deferred royalty plan" in which U.S. tax payments can be delayed, which is only legal if Castroneves had no relationship or control over it. Prosecutors say he did have control and that false statements were made to Penske about the relationship.

Coimex paid Castroneves $600,000 between 1999 through 2001 for sponsorship contracts, but he only paid taxes on about $50,000, prosecutors said.

Katuicia Castroneves transferred some of the hidden money to a Swiss bank account she controlled with her brother, court documents show.

Working telephone number for Castroneves and his sister could not be located Thursday. Miller did not immediately return a call to his office in Michigan.

Castroneves recently signed on with "Entertainment Tonight" to be a correspondent for some episodes of this year's "Dancing With The Stars" show. He did a similar stint last year.

He has raced for Team Penske since 2000, capturing Indy 500 victories in 2000 and 2001, becoming the youngest driver, 27, to win the famous race twice. Castroneves has recorded a total of 18 victories and 43 top-three finishes, according to Penske's Web site.

Miami-Dade County records show that Castroneves, who is single, lives in a six-bedroom, six-bath home in Coral Gables valued at about $2.3 million.

 

[2strokeYardSale]

Sounds like a good time to take your ball and play elsewhere. Flip the gubbmint the bird as you head to Monaco.

 

[TLC]

***but taxation is illegal! it was never writ into the constuutuion!
He'll get off, just like blade...er...weasley did
:rofl

 

[afm199]

Snipes is going to do three years.

 

[Owensdad]

Snipes is going to do three years.

I'm pretty sure TLC was being sarcastic. Blade should be thanking his lucky stars. Failure to file a return?!?:wtf

His accountants are doing 10.


Helio will at least have a *chance* in court, depending on how good his attorneys are. For sure, Special Agents of the Treasury have been investigating this for a while. They generally don't go to justice until it's a lock.

edit: I did a little research and I think this will end badly for Helio; from DOJ website:

Count one alleges that Helio Castroneves entered into sponsorship contracts with Coimex, a Brazilian import and export company, for 1999, 2000 and 2001. Each year’s contract required Coimex to pay Helio Castroneves $2,000,000. However, pursuant to an unwritten side agreement, Helio Castroneves returned $1,800,000 each year to certain Coimex executives, and kept $200,000 for himself. Of the $600,000 Helio Castroneves retained from the Coimex contracts, he reported only $50,000 on his federal income tax returns.

In regards to the Penske income, count one of the indictment alleges that Helio Castroneves joined Penske as a race car driver in November 1999, and that Miller negotiated the deal with Penske and drafted the resulting contracts. Under the terms of the contracts, Helio Castroneves’ $6,000,000 three-year (2000, 2001 and 2002) compensation package would be split between a $1,000,000 driver agreement and a $5,000,000 licensing agreement. Pursuant to the licensing agreement, Seven Promotions was to receive the $5,000,000 in exchange for the licensing rights to Helio Castroneves’ name, likeness and image. The indictment specifically alleges that Helio Castroneves, Katiucia Castroneves and Miller engaged in a scheme to avoid paying taxes on the $5,000,000 in licensing agreement income by creating a "deferred royalty plan" that required Penske to send the $5,000,000 payment to an offshore company – Fintage Licensing B.V. (Fintage) – in the Netherlands, instead of to Seven Promotions.

Despite advice from outside tax counsel that Helio Castroneves would not qualify for the deferred royalty plan and would owe income tax on all payments under the licensing agreement if he or any member of his family owned or controlled Seven Promotions, the three defendants engaged in this deferred royalty plan. Accordingly, Miller and Helio Castroneves falsely represented to tax counsel that neither Helio Castroneves nor anyone in his family had any interest in, or control of, Seven Promotions. Based on these misrepresentations, the deferred royalty plan was executed between Penske and Fintage; Penske paid Fintage the $5,000,0000 originally due to Seven Promotions under the licensing agreement, and no income tax was ever paid by Helio Castroneves on the $5,000,000 in licensing agreement payments.

In counts two through seven of the indictment Helio Castroneves and Katiucia Castroneves are charged with six counts of tax evasion based on allegedly false federal income tax returns filed by Helio Castroneves for years 1999 through 2004. Miller is charged with three counts of tax evasion based on allegedly false federal income tax returns filed by Helio Castroneves for years 2000 through 2002.

 

[afm199]

I hope the fucker does a full three. We pay our taxes. He thinks he has no need to. Piss on him.

 

[Owensdad]

I bet the farm that plea negotiations are happening as we speak. Plead to fraud get the conspiracy dismissed, 8 years 5 suspended for Helio, 10 years 7 suspended for his attorney due to his advanced age.

I would regard that as a best case scenario.

The fact that DOJ is printing in a press release on the day of the indictment that outside "tax counsel" adivsed otherwise with regard to the royalty plan is a really, really bad sign. That probably means they flipped an attorney. There is no privilege afforded to co-conspirators.