By JJ MacNab | January 22, 2008
Witness Crowley (Continued): The papers filed by Snipes over the years were fairly typical tax denier fare. Snipes tried to demand that certain forms, statements, and in one case, even a book, be added to his official IRS file. He tried to file a 42 page letter instead of a Form 1040, even though none of the typical information such as income or deductions was provided in the letter. Snipes also demanded that the IRS respond to his 42 page document within 30 days or they would default on his demands.
In his correspondence with the IRS, Snipes referred to himself repeatedly as â€œoneâ€ rather than â€œI.â€
Witness Kenneth Starr: Mr. Starr owns Starr & Associates in New York and is no relation to the Ken Starr who investigated President Clinton in the Monica Lewinsky affair. Mr. Starr is an attorney with a masterâ€™s degree in taxation, and his firm offers business management, bookkeeping, and accounting services to celebrities and high net worth individuals. Snipes became his client in the early 1990s.
In 1999, tax planning and preparation for his client began to get a lot more difficult. Mr. Snipes had apparently purchased a â€œpure trustâ€ and placed his substantial business assets in a Swiss account through this trust. When it came time in early 2000 to prepare the 1999 tax returns, Snipes refused to provide the required information and instead told his advisor about the 861 scheme. When Starr warned Snipes that following such advice would get him in trouble, Snipes told him, â€œYou always think youâ€™re right and you always know everything. You arenâ€™t right about this.â€
Mr. Starr terminated his professional relationship with Mr. Snipes in mid 2000 and warned him in a 90 minute phone call that he was making a serious mistake and to obtain a professional opinion.
On cross examination, defense attorney Barnes attempted to claim that Snipes had lost money in 1998 as a result of Starrâ€™s mismanagement. Starr said that all of the investments he recommended and managed had made money but that Snipes had spent a considerable sum that year filming documentaries. Barnes accused Starr of taking out a loan without Snipes knowledge, but Starr said that Snipes had taken out the loan and even signed several renewal notes. Snipes had even complained to the New York District Attorneyâ€™s office about Starr, and the DA had not taken any action against Starr. Barnes asked whether Starr had gotten Snipes involved in the doomed Planet Hollywood investment, but Starr said that Snipesâ€™ friend Robert Earl had convinced Snipes to invest.
Witness Ronald Starr: Ronald is Kenneth Starrâ€™s son, and has a law degree as well. Ronald confirmed that the problems started in 1999 and continued until Starr & Associates terminated the Snipes account in mid 2000. In March 2000, Ronald and Starr & Associates accountant Michael Canter called Eddie Ray Kahn and were told that â€œThe Internal Revenue Code isnâ€™t law, and that Section 861 defines which income is taxable.â€
Witness Michael Canter: Mr. Canter is a CPA employed by Starr & Associates for the past 15 years. His statements confirmed the stories already told by Kenneth and Ronald Starr.
- Snipes letterhead reads â€œDr. Wesley T. Snipes.â€ He was awarded an honorary PhD from SUNY.
- Snipes signs his name, usually in red ink (a tax denier trademark) as â€œDr. Wesley Trent.; Snipesâ€ complete with punctuation.
- One of the letters shown on the overhead projector referenced a PILL account. This refers to a now-defunct tax denier scheme known as Prosper International League Limited.
- The â€œpure trustâ€ that Snipes purchased in 1999 was set up by a now defunct company called Commonwealth Trust Company. Promoter Wayne Rebuck will possibly be a later witness in this trial.