Simkanin guilty of 29 counts of tax violations

FORT WORTH - After deliberating for more than 13 hours over two days, a federal jury Wednesday convicted Bedford businessman and tax protester Richard Simkanin on 29 counts of violating U.S. income tax laws.

The jury of six men and six women delivered its verdict shortly after 8 p.m. They remained deadlocked on two counts within the indictment, leading U.S. District Judge John McBryde to declare a mistrial on those charges.

Simkanin stood silently with his hands behind his back, showing no emotion, as a court clerk read the 29 guilty verdicts. Some supporters in the courtroom dabbed their eyes; others glared at the judge.

Simkanin, 59, is scheduled to be sentenced April 30, Assistant U.S. Attorney David Jarvis said. He can get up to five years on each of the 25 felony counts and up to a year on each of the four misdemeanor charges.

"Justice was served, and we're pleased that the jury understood that no one is above the law," Jarvis said.

Arch McColl, the Dallas lawyer representing Simkanin, said his client was denied a fair trial because McBryde did not allow him to present key evidence on whether Social Security, Medicare and income taxes are voluntary.

McColl said he expects to win on appeal, but he added that it is time for Americans to pay attention to what happened in court.

"I'm terribly disappointed," McColl said. "It was not a fair trial in accordance with the Sixth Amendment of the Constitution that includes the fundamental right to present evidence on your own behalf."

Robert Schulz, founder of We the People Foundation for Constitutional Education, a group that questions the validity of the nation's tax laws, told Simkanin's supporters that the defendant was prepared for the worst.

This is the second time Simkanin has gone on trial. In November, McBryde declared a mistrial when jurors who deliberated for eight hours said that they were deadlocked and could not reach a unanimous verdict.

Simkanin is almost considered to be a political prisoner by groups that question the validity of the nation's tax laws. They contend that most Americans are not required to pay income taxes.

They are particularly hostile toward the Internal Revenue Service, an agency that, they say, is not an official government entity.

Simkanin's supporters came from around the country. They held a vigil at the courthouse, at one time praying in the hallway. They often gave him a thumbs-up gesture as he entered the courtroom. Once, Simkanin got a standing ovation.

During the trial, Simkanin testified that he didn't withhold employees' taxes for Medicare and Social Security benefits because his research did not produce a law showing that participation in the programs was mandatory.

But Simkanin backed away from some of his anti-government comments, saying they were a mistake. He once wrote to the U.S. Treasury secretary saying that he had repatriated himself from the United States to the "Republic of Texas."

When McColl tried to query witnesses on legal definitions of "employee" and "wages," McBryde cut him off. The judge told jurors they could not question the constitutionality of the tax code.

Prosecutors put 11 witnesses on the stand to show that Simkanin knew what he was doing when he stopped withholding and paying taxes. Under federal tax laws, ignorance of tax codes can be used as a legal defense.

They asked for legal definitions and whether they had to review evidence on who does have to pay taxes.

McColl said his client's company, Arrow Custom Plastics, is in deep financial trouble because of his fights with the government. Simkanin has been in jail since June.

Simkanin was convicted on 10 felony counts of failing to withhold about $139,000 in taxes from employees' wages and 15 felony counts of filing false tax refund claims for about $235,000.

He also was found guilty of four misdemeanor counts of not filing individual income tax returns from 1998 to 2001. Simkanin had an estimated gross income of about $410,000 during those years, according to the indictment.

Dottie Harrison, a Simkanin supporter from Houston, said his allies will continue to fight.

"I'm in shock, but the determined energy everyone feels to overturn this injustice will be a catalyst that will expose the entire IRS fraud," she said.

Sorry Sink. Usually, we have a level of agreement on some issues. This is not "Another one bites the dust." This is one in which the American people, and in particular, Simkanin got more rights taken away. This is an utter outrage that the defense of a man is that the laws that he's being charged with are a violation of the Constitution, and the judge prohibits and even instructs the jurors that the "constutionality" of the laws in question is not even a valid question. If the Appeals court can prove that it's not just a rubber stamp of the IRS and that the courts can't just make up laws as they go, this will be thrown out at first glance. It's an abomination of the justice system.

If the IRS wants to prove their case that there is a Constitutional grounds for their confiscatory tax practices, fine. Let them do it. The utter arrogance of the IRS is appalling. And you and every other American should be disgusted. "We make the laws, and we tell you how to respond to them and if you don't like it, we'll take your house and your business and throw you in jail. And we're above you, so we don't have to answer any of your questions." The first trial, the IRS agents were asked to provide anywhere in the code that he was required to pay the taxes. They refuesd to do so. They all flatly refused to testify. This time, they found a judge that was on their side, and they were able to shaft someone. If they have a case, then let them stand up in open court and defend it. If they can't, then they should be prosecuted for making these backroom deals to rip off people's rights.

They accuse Rush of "doctor shopping". Well, that's a minor problem (major problem for their prosecution, because they're also accusing him of illegally obtaining them from a pusher, so, why would he have any need to "doctor shop"). In this country, the major offense should not be "doctor shopping" but "JUDGE shopping." And those prosecutors that have so little faith in their cases that they would risk trying an innocent man by shopping for a friendly judge that will take away all of a man's defense by acting like a three year old sticking his fingers in his ears and shouting "I can't hear you", the prosecutors should be tried and convicted.

As I'm sure you can imagine, I'm a LITTLE miffed about this one. It's clearly a violation of his constitutional rights. If he broke the law, prove it. Don't prevent him from making a defense and then say "See, he didn't say anything we could hear, so we proved it." It's sick. And all of you who love freedom should be sick and should also be afraid.

Remember, keep your guns clean, because when they come for all of us who love liberty, it's going to be our only defense against tyrrany. And this, Sink, is nothing but tyrrnany.

01-06-04
Federal Tyranny, Texas Style

Justice Held in Contempt
Simkanin Takes The Stand

(Updated Tuesday, 1 PM Central)

(Above Judge McBryde's head near the USDC courtroom ceiling):

REASON IS THE LIFE OF THE LAW
NAY THE COMMON LAW ITSELF IS NOTHING BUT REASON

Fort Worth -- Federal prosecutors and USDC Judge John McBryde continued in earnest yesterday afternoon to deny all reason and justice in their quest to control the trial and ensure the conviction of non-withholding employer Dick Simkanin.

Fortunately, Simkanin's attorney, Arch McColl, despite a clearly biased and hostile courtroom environment, made a noteworthy stand against the tyrannical acts of the judge and Assistant US Attorney. According to observers in the fully packed courtroom, the thinly veiled attempts by the government to deny justice to Simkanin were not lost on members of the jury. They were certainly not lost on the courtroom observers.

As one example of Judge McBryde's vision of due process, McColl (yesterday) filed five separate Motions to Dismiss, including one challenging the legal sufficiency of the charging indictment. As WTP has noted in pervious updates, Simkanin's indictment does not cite ANY specific US statute Simkanin is alleged to have violated, but merely specifies the general, "multi-purpose" Title 26 "penalty" statutes that are imposed IF one that is required to file (or withhold), fails to do so. At the bench, Judge McBryde openly admitted he had not read any of the Defense motions, but regardless, summarily dismissed all of them within seconds.

As to the government's case (which wrapped up Tuesday morning), Assistant US Attorney Jarvis, opened his prosecutorial drama by bringing in a number of Simkanin's former employees and accountants. These first witnesses were able to repeatedly reiterate their personal tales of how they "knew" (and warned) Simkanin that he was "breaking the law" by not withholding.

They further went into explaining why they severed their relationships with Simkanin rather then face legal troubles by questioning the law or the IRS. Although it was clear this initial barrage of government witnesses was intended to construct for the jury the illusory "fact" that Simkanin "broke the law," they, conveniently of course, could not be directly questioned about their actual knowledge of the law that they were speculating about because they were not legal experts.

Following these preliminary government witnesses, the DOJ brought out several of their IRS agents and tax experts. These witnesses, although personally and officially responsible for enforcing US tax law, uttered precious few words concerning the actual content of the law, and were again, conveniently protected by Judge McBryde from any substantive cross examination that might entail any detailed discussion of Simkanin's true legal obligations under the law.

Below are notes that were transcribed directly during the testimony of the IRS witness Joe Cooper. It is Cooper who, on behalf of the IRS, formally denied Simkanin's claims for tax refunds, thereby establishing the legal basis for twelve of the 35 tax crimes Simkanin is charged with. (Note: Cooper was the IRS witness in the first trial that recanted his testimony, changing his assertion as to which specific legal definition of the term "employee" applied to Simkanin's alleged crimes) Notice the unwarranted behavior of Judge McBryde as Arch McColl attempts to solicit from the witness his factual and legal basis for denying Simkanin's refunds on cross-examination:

(Note: McColl questions in green, IRS's Cooper testimony in yellow)

Testimony of Joe Cooper:

He conducts examinations and claims for refund - (Government exhibit 91 entered, claim for refund that Simkanin submitted.) He admits reviewing the claims and what he put in the denial letter. He reached the (legal) conclusion that the refund had no merit and the claim would be denied. He informed Simkanin of such on the phone. He also told Simkanin the courts had consistently denied arguments with his position. He looked at counts 1 through 12 showing the total wages indicated and found them to be correct from his calculations.

McColl's cross-examination of Cooper:

If Arrow Custom Plastics corporate income was .McColl is cut off before he can ask the question - Judge denies him to ask the question before he can ask it. Defense asks judge: can he even ask the question and judge says no. When you made your evaluation did you base it on title 26? Did you make it according to the letter he provided? Judge stops him and calls them up to the bench for a scolding.

Did you have any supreme court cases you could have used.Judge states it is beyond the scope and tells him to move to something else. Presuming that Simkanin is correct, is it true.Judge stops him and states it is beyond the scope. Do you remember what year your conversation occurred in? - (answers 2002). In order to reject this claim did you have to do a calculation of the gross income that was involved in the income, such as excludable income? Judge stops him and tells him to get onto something relevant to the subject.

Is it true that there are certain items within the class of income that is within the scope? Judge stops him again and states that the subject is wages withheld and not gross income. Did you have any conversation with Simkanin about him not filing any returns? (answer) Yes - and he said he didn't believe he had to withhold from employees. Further question from defense about employees not being subject to withholding Judge stops him and states it is beyond the scope. Do you know what courts have continuously rejected.Judge stops him and states it is beyond the scope. Within the scope of your expertise do you deal with medicare or .Judge states it is beyond the scope. Did you say that you had researched the law? Yes, What law did you research - I don't recall.

Did you say that you researched court cases? Judge stops him again. Did you look at any regulations, Yes - 3401. Did you explain that to Simkanin? Are their guidelines that you act under? Yes, Do the guidelines call for you to give direct answers to people making claims? Yes, Judge concludes his questioning if he dares to ask any other questions that are beyond the scope. Did you think some thought had gone into Sim. letter sighting 20 regulations and numorous court cases? Yes, Can you see how a person might view.Judge stops him stating it is argumentative. Did you tell him he could appeal? Yes.What is the normal process he would have.Judge stops him.

The balance of the afternoon followed similarly to the testimony cited above, with the government attempting to paint Simkanin as a criminal because he cashed checks in excess of $10,000 (while running a $5,000,000 a year business), because he changed the corporate signature card at his bank, and because he wrote his Congressman to urge passage of proposed legislation by Rep. Ron Paul (TX) that would have eliminated the withholding "requirement" (implying that this letter established Simkanin knew what the current law requires with respect to withholding).

As further evidence of the bias against Simkanin, courtroom observers noted several instances where Judge McBryde sustained objections, even BEFORE they were made by the US Attorney. Testimony lasted until after 6 PM Monday evening when the court was recessed.

On Tuesday morning, Jarvis recalled two of Simkanin's former associates to reiterate portions of their testimony.

In a rare moment of acknowledging the rights of the defendant, McBryde quickly admonished the AUSA for his additional grilling of these witnesses as Javis pushed for further condemnations and opinions regarding Simkanin and his decisions to stop withholding and filing. Shortly thereafter, the defense rested.

Before 10 AM, Simkanin had taken the stand as the first defense witness and was being questioned by his attorney Arch McColl. An initial report from a courtroom observer indicated that Judge McBryde was continuing his role as "executive producer" of the trial by aggressively limiting Simkanin's testimony to simple "yes or no" responses to his own lawyer's questions.

A number of other defense witnesses were preparing to testify later today. It is unknown if the Judge will allow any witnesses aside from Simkanin. More news as it is available..

Other Trial Tidbits:

Until McColl strenuously objected yesterday just before the start of the trial, Dick Simkanin, (who has never been convicted of any crime) was still bound in prison leg restraints as he sat at the Defendant's table.

A number of courtroom observers reported being somewhat disturbed that the US Marshals routinely physically lock and "dead-bolt" the single, main entrance into the courtroom while the court is in session. Several noted the obvious violations of fire regulations and the clear risks should an emergency occur. The Marshals apparently do this on at the direction of Judge McBryde who abhors the public entering or leaving the public courtroom while court is in session.

Numerous observers noted that Juror #4 (female, apparently in her early twenties) spent much of yesterday virtually asleep with her head slumped back. Apparently, neither the judge nor DOJ were concerned.

Additional details regarding the blocking of parked cars directly across from the federal courthouse that took effect mid-morning yesterday have been determined. The parking ban was carried out by local Fort Worth police. The local federal "Homeland Security" officer stationed outside the courthouse told WTP sidewalk protesters that the parking ban was, in fact, instigated specifically as result of the recent increase to the "orange" terrorist threat level set by the Office of Homeland Security. The officer could not explain why the parking ban was not instituted until yesterday morning (Monday, January 5th) considering the terrorist level was officially raised to "orange" the weekend prior to Christmas.

The Fort Worth Star-Telegram published another lead story on Tuesday covering the Simkanin trial. Even the reporter noted the apparent bias against Simkanin as McColl attempted to discuss the legal definitions of the key statutory terms "income" and "employee". The reporter noted that when McColl attempted to ask the IRS legal expert if Social Security taxes (that Simkanin is charged with) were mandatory under the law or not, Judge McByde stopped McColl and sternly warned, "We're not going to play this game."

Bob Schulz was the live guest on the leading 50,000 watt KLIF/AM 570 Dallas talk radio show during the peak "drive time" this morning. One caller to the show following Schulz's interview admitted to not filing federal tax returns since 1976.

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