Skip to comments.Federal Court orders halt to internet-based tax-fraud scheme
Posted on 12/05/2006 6:29:02 PM PST by Central Scrutiniser
FOR IMMEDIATE RELEASE MONDAY, DECEMBER 4, 2006 WWW.USDOJ.GOV TAX (202) 514-2007 TDD (202) 514-1888
FEDERAL COURT ORDERS HALT TO INTERNET-BASED TAX-FRAUD SCHEME
Maryland Man Operated Frivolous Letter-Generating Complex
WASHINGTON, D.C. - A federal court in Baltimore has permanently barred John Baptist Kotmair, Jr., of Westminster, Md., and his organization, Save-a-Patriot Fellowship, from selling a tax-fraud scheme, the Justice Department announced today. The court described Kotmair as a seasoned tax protestor, stated it was without question that he is violating the tax laws, and described his representations about the tax laws as clearly fraudulent.
The courts opinion states that Kotmair and his organization knowingly made false and fraudulent statements to their customers about the tax benefits of their schemes. According to Senior Judge William Nickersons opinion, Kotmair, in 1984, shortly after serving two years in prison for failure to file income tax returns, began promoting the position that U.S. citizens need not pay any taxes on income earned within the 50 states a view, according to the court, that has come to be known as the Section 861 argument. The Internal Revenue Service (IRS) refers to this section in its Dirty Dozen list of most notorious tax scams: http://www.irs.gov/newsroom/article/0,,id=154293,00.html.
People who sell and participate in tax fraud schemes harm all law-abiding Americans, said Eileen J. OConnor, Assistant Attorney General for the Justice Departments Tax Division. The Justice Department and Internal Revenue Service are working vigorously to stop the promotion of tax-fraud.
According to the opinion, the defendants boasted that their operation has grown into a complex of property with the equipment necessary to generate large numbers of frivolous documents to file with the IRS. The court found it was abundantly clear that the defendants were violating the Internal Revenue Code, that they would continue to do so, and that an injunction was necessary to stop their activities.
Besides falsely advising customers that they need not pay tax or file income tax returns for income earned in the United States, the opinion states that Kotmair and his organization falsely told clients they can legally quit the Social Security system.
The judge noted that Kotmairs organization continued to file frivolous protest letters on behalf of more than 800 customers during the litigation and showed no inclination . . . to cease their activities. He also stated that many of Kotmairs adherents are likely to have unmet federal income tax obligations, adding to the adverse impact of the defendants activities.
The court also found that Kotmairs organization sold fraudulent programs in an attempt to help customers avoid taxes and that their illegal efforts were ongoing. The opinion said that Kotmair and his organization knew or had reason to know their statements to customers were false, because the arguments have been thoroughly rebuffed by other courtsincluding a Pennsylvania federal courts 2004 decision barring Thurston Bell, one of Kotmairs former employees, from selling the same scheme on a rival Web site. (For information about that case, go to http://www.usdoj.gov/tax/txdv04061.htm.) Judge Nickerson wrote that the defendants stubbornly choose to ignore the rulings of numerous courts.
The courts order permanently bars Kotmair and his organization from representing or assisting any person in preparing correspondence to the IRS or assisting any other person in preparing court filings relating to income taxes; requires the defendants to notify those associated with promoting this tax fraud scheme and all individuals who participated in it of the entry of this injunction; and requires that the Justice Department be provided their customers names, mailing and e-mail addresses, and telephone and Social Security numbers. Additionally, the order requires notification of their customers of the permanent injunction; and requires Kotmair and his organization to post the injunction prominently on their Web sites for one year, and to remove from their Web sites their tax fraud promotional materials.
Since 2001, the Justice Department has obtained more than 200 injunctions to stop the promotion of tax fraud schemes and the preparation of fraudulent returns. Information about these cases is available at http://www.usdoj.gov/tax/taxpress2006.htm. Information about the Justice Departments Tax Division can be found at http://www.usdoj.gov/tax/index.html.
WHAT?! They're shutting down the IRS?
A newbie at H&R Block would give better tax advice.
No, John Kotmair, a fraud artist extrordinare.
Certain tax protestor nuts followed this guys advice and are in for a rude awakening.
Its one thing not to like taxes, but to defraud people under the guise of "patriot" and steal their money is another...
Scum? I thought he was a hero to many Freepers?
Justice Department Files Complaint Against SAFP
Alleges Fellowship is "Abusive Tax Shelter"
As many are already aware, the Justice Department has filed a frivolous complaint against the Save-A-Patriot Fellowship, alleging that it is an "abusive tax shelter."
The present-day condition of the federal government and the American business community is indicative of an impending financial collapse. General Motors and Ford stock now carry junk-bond status, and foreign investors, whose treasury bond purchases keep our currency afloat, are becoming nervous as our national debt skyrockets at the rate of $1.58 billion per day. So, although their 1993 raid backfired on them badly, apparently the one-world socialists that now control our government can't take the chance of any educational organization operating if that organization can inform bewildered, angry Americans as to what really is happening to them.
Save-A-Patriot has not changed its method of operation since winning against the Department of Justice in court in 1996. (The DOJ appealed that decision, then shortly thereafter asked the court to dismiss its own appeal, with prejudice! The court granted their request and so ordered.) For that matter, we have not changed the way we operate since the Fellowship's inception in 1984.
If the court declared the Fellowship's operation legal in 1996, it must certainly be legal in 2005. If the IRS could not find any criminal activity in 1993 and 1994, while they had all of our computers and paper files, surely they would not find any today. Therefore, the current Department of Justice complaint against the Fellowship can only have one reason behind it, other than to harass, and that is to stop the teaching of the Internal Revenue Code as it is exactly written.
As the case moves forward, we will be providing on this page information and copies of documents filed by both sides. The following items are currently available, in PDF format:
No, he is the founder of Liberty Post and the beneficiary of their "donations".
Thank you...I knew that LP's server was in Westminster and you just confirmed my suspicions.
Yep, they have been his stooges for quite a while.
Its amazing that people still fall for these scams.
- When there is an income tax, the just man will pay more and the unjust less on the same amount of income.
If anyone would like to be added to this ping list let me know.
A bill to promote freedom, fairness, and economic opportunity by repealing the income tax and other taxes, abolishing the Internal Revenue Service, and enacting a national retail sales tax to be administered primarily by the States.
Refer for additional information:
Is this guys one of our "friends"?
LOL, not likely.
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