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FOR IMMEDIATE RELEASE TAX

TUESDAY, MAY 2, 2006 (202) 514-2007


WWW.USDOJ.GOV TDD (202) 514-1888

Three Convicted in Tax Fraud Scheme


WASHINGTON, D.C. - After an 11-week trial and ten day of deliberations, a
federal jury in San Diego found Susan E. O’Brien, a professional tax preparer, and
two others guilty of tax crimes, the Department of Justice and the Internal Revenue
Service (IRS) announced today. O’Brien and co-defendants, R. Richard Evans and
William D. Cook, were found guilty of attempting to evade the taxes of a former
client, Dr. Kevin Marie Scoggin, (who later pleaded guilty to felony tax charges),
for the years 1996 through 2000. The jury also convicted O’Brien and Evans of
conspiracy to defraud the United States and aiding and assisting in the filing of
fraudulent tax returns. O’Brien was also convicted of evading the payment of tax on
her own income.

In July 2003, O’Brien, Evans, Cook and five others were charged in a 78-count
indictment with various tax crimes relating to tax years 1996-2002. According to the
indictment and trial evidence, O’Brien, the owner and operator of The O’Brien
Group, prepared numerous income tax returns that claimed false deductions,
including amortization expenses for fabricated intangible assets. Evans promoted,
sold, and managed domestic trusts that were used by clients to conceal income and
assets from the IRS. Cook and Scoggin used one of Evans’s trusts to conceal
Scoggin’s income and assets by maintaining bank accounts in nominee names,
holding offshore bank accounts, and assigning income to nominee entities. Cook
and Scoggin also evaded Scoggin's taxes by making false statements to the IRS.

“Tax return preparers who help others evade taxes do more than harm the reputation
of law-abiding professionals,” said Eileen J. O’Connor, Assistant Attorney General
for the Justice Department’s Tax Division. “By defrauding the federal treasury, they
harm all honest taxpayers. The Department of Justice is working vigorously to
investigate and prosecute the promotion of tax fraud schemes.”

Defendants Violet Negrete-Jauregui, Jeffrey Barber, Kathy Hill, Stephen Maranto


and Forest Buckmaster previously pleaded guilty to felony tax charges and testified
during the trial. Two others, Scoggin and Charles Matich, pleaded guilty to tax
felonies prior to indictment and also testified for the government.

“The convictions today reinforce the message that those who promote the use of
abusive tax schemes to circumvent the tax laws will be held accountable. It is a
matter of maintaining public confidence in our system of taxation,” said John
Imhoff, Acting IRS Chief, Criminal Investigation. “IRS Criminal Investigation is
committed to stopping the use of fraudulent foreign and domestic trust
arrangements to evade taxes.”

The Honorable Judge M. James Lorenz set sentencing dates for O’Brien, Evans, and
Cook on July 31, 2006 at 8:30 A.M. PDT. Sentencing dates for the seven
cooperating defendants are scheduled for May and June.

Assistant Attorney General O’Connor and United States Attorney Carol C. Lam
thanked Tax Division trial attorneys Charles O’Reilly and Michael Vasiliadis, the
prosecutors in this case, and paralegal specialist Isabelle Balakit Adams. They also
thanked IRS special agents Alison Lansdale and John Weeks whose assistance was
essential to the successful investigation and prosecution of this case.

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