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Commercial Fishers Sentenced to Jail Time For Willful Failure to Pay Taxes on Income

IRS Investigation Reveals Couple Prioritized Travel and Gambling over Taxpayer Obligations

 

October 05, 2018
Friday PM


(SitNews) Ketchikan, Alaska - A Southeast Alaskan couple were sentenced today in Juneau for willfully failing to pay their individual income taxes, and instead prioritized spending money on traveling and gambling. The announcement was made by U.S. Attorney Bryan Schroder.

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Archie W. Demmert III, 58, and Roseann L. Demmert, 61, both of Klawock, Alaska, were sentenced today by Chief U.S. District Judge Timothy M. Burgess to each serve 12 months, plus one day, in federal prison on two counts of willful failure to pay income tax.

As part of their plea agreements, the Demmerts will pay restitution to the IRS for the calendar years charged covering 2011, 2012, 2013, and 2014.

Archie Demmert and Roseann Demmert both had commercial fishing permits for herring spawn on kelp, and Archie had an additional commercial fishing permit for a salmon purse seine. In May 2018, the Demmerts admitted in court that they earned income from commercial fishing for over a decade, from 2006 to 2014, but willfully chose not to pay over $300,000 in income taxes, excluding penalties and interest.

According to court documents, the Demmerts have a long history, dating back to at least 1994, of avoiding the majority of their taxpayer obligations. Even after the charges were filed in 2017, the Demmerts have not made any payments toward their taxes to the present day. Throughout the decades while the Demmerts have avoided collection of their taxes, they had the means to pay their taxes but they willfully chose not to do so. Instead, they spent their money on travel and gambling at casinos.

For example, in November 2012, Roseann Demmert cashed out over $20,000 from the Cache Creek Casino, but two days later told the IRS they could not make any tax payments. In 2012, the Demmerts took two trips to California wine country, spending thousands of dollars on their trips instead of paying their taxes.

In 2013, the Demmerts agreed to settle their tax liabilities by paying $80,000; but then, according to court documents, Archie Demmert withdrew $84,000 from their bank account and then told the IRS they had no ability to pay. Shortly after the cash withdrawals by Archie Demmert, the Demmerts were back gambling at casinos in Las Vegas and Washington, despite telling the IRS they had no way of paying their tax debt.

In April 2014, the IRS made a demand for full payment of taxes and penalties not paid by the Demmerts; however, over the next six months, the Demmerts spent approximately $56,000 on travel, entertainment, casinos and paying their credit cards bills. Over the next few years, this pattern of not paying taxes but frequenting casinos continued until the court prohibited the Demmerts from going to casinos at the Change of Plea Hearing held in May 2018.

Archie W. Demmert III has served on the Klawock City Council.

IRS Criminal Investigation (IRS-CI) conducted the investigation leading to the successful prosecution of this case. This case was prosecuted by Assistant U.S. Attorney Andrea Steward and Trial Attorney Lori Hendrickson of the Tax Division.

 

Related:

Klawock Couple Charged With Willful Failure to Pay Over $400,000 in Income Taxes on Income Earned For 13 Years...
SitNews - July 27, 2017

Klawock Husband And Wife Plead Guilty To Willful Failure To Pay Taxes
SitNews - June 01, 2018

 

 

Editing by Mary Kauffman, SitNews

 

 

Source of News:

U.S. Department of Justice - Alaska District
www.doj.gov

Internal Revenue Service - Criminal Investigation
www.irs.gov

 

 

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