Justice Department Accuses Businessman Of Evading $200 Million In Tax

by Leroy Baker, Tax-News.com, New York

02 March 2005

America’s largest case of individual tax evasion was revealed by the Justice Department on Monday after a telecommunications entrepreneur was arrested on charges of evading more than $200 million in federal and local taxes.

According to the 12-count indictment, William Anderson, a telecommunications entrepreneur, is said to have illegally sheltered almost $450 million from the US tax authorities through the creation of several complex corporate structures registered in offshore jurisdictions designed to mitigate tax resulting from a merger involving his firm, Mid Atlantic Telecom.

The Justice Department stated that: "The grand jury charged that, beginning in 1992, as Anderson realized that the merger of his first successful company, Mid-Atlantic Telecom, with another company would result in substantial taxable earnings, Anderson allegedly formed an offshore corporation to receive and disguise his anticipated income.”

Meanwhile, Kenneth Wainstein, US attorney for the District of Columbia, has further revealed that Mr Anderson, who was arrested on Saturday after stepping off a flight from London, failed to file tax returns for the years 1987 through to 1993, and owes $170 million to the IRS.

Anderson is also said to owe an additional $40 million in taxes to the District of Columbia after allegedly claiming to be a resident of Florida, which does not levy a state income tax.

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