FAMED IRS WHISTLEBLOWER GETS TAX FRAUD ACQUITTAL
JURY SAYS BANISTER GUILTY OF NO CRIME
By Peymon Mottahedeh
The Internal Revenue Service’s efforts to silence one of its most formidable critics backfired when a jury acquitted Joe Banister, a former IRS criminal investigation division special agent and fraud expert.
On June 23, in Sacramento, Calif., a unanimous jury of 12 found Banister not guilty of three counts of assisting in preparation of false tax returns and one count of conspiracy to defraud the U.S. government.
Had the IRS been successful in convincing the jury that Banister was guilty, he would have faced going to prison for up to 14 years.
Since 1999, Banister had been trying to get the government to answer the questions that he and scores of other Americans have been raising about the legality and imposition of the federal income tax on the average working citizen.
While an IRS agent, Banister wrote a detailed 95-page report on this issue and presented it to his IRS superiors for an answer. He went to Washington to meet with the president, heads of Congress and the IRS. He also appeared on C-Span2 and in nationwide newspaper advertisements telling of his questions.
Rather than answering Banister’s report, the IRS encouraged Banister to resign, which he did. At every turn, the federal government refused to answer Banister’s questions. IRS and the Department of Justice decided to “answer” Banister by charging him with four tax-related charges in November 2004.
IRS claimed that a major part of these “crimes” was Banister’s speech in October 2000 at Cencal Aviation Products in Northern California. This speech was videotaped and reported on by David Cay Johnston of The New York Times.
At this two-hour meeting, Banister presented a case for the questionable nature of the way the federal income was imposed on ordinary Americans and the suspicious behavior of the government in refusing to answer these questions.
During closing statements in the trial, Assistant U.S. Attorney Robert Twiss argued to the jury that Banister used false means to “wipe out” taxes that were allegedly owed by Cencal owner Al Thompson, and that to Banister, “it was all about the money, the money.”
However, an April 2001 email between a Department of Justice lawyer named DiLeonardo, who had worked with Banister while Banister was working at the IRS, and Ron Semino, the chief of the Western Division of the Department of Justice’s Tax Division, showed that the government viewed Banister to be the most visible personality in what many people today call “the tax honesty movement.”
After Banister was indicted, IRS Commissioner Mark Everson stated: “Joe Banister, a former IRS agent, knew exactly what he was doing. Tax professionals and employers who break the law will be held accountable.”
Apparently the jury agreed with Everson that Banister knew exactly what he was doing. However, they saw no crime in what Banister was doing.
Two of the jurors, who spoke with AFP right after the trial, related the thinking that led to their decision. They said the false tax return charges were “non-starters with the jury.” The jury saw that the IRS might have disagreed with the position of Banister on the tax returns. However, the tax returns contained no false information.
The jurors said they were surprised when the testimony part of the case ended, since they had yet to see or hear any evidence of a crime.
They said the evidence showed that Banister was honest, straightforward, credible, believed in what he was doing and was trying to follow the law.
They also believed that Banister was honestly trying to get answers, but the government consistently refused to answer his questions and address his concerns.
The government presented enough evidence to acquit Banister, they said. The jurors said they saw nothing deceitful or dishonest on Banister’s part.
And, finally, they said the government simply presented no evidence of any crimes committed by Banister. After a few hours of deliberations, the jury took a vote, and six or seven of them were ready to acquit Banister of all charges. Other jurors still had doubts. But after the jury saw Banister’s video a second time, the remaining doubts as to Banister’s innocence were removed.
This defeat at the hands of one of the most visible figures in the anti-income tax movement dealt a serious blow to the IRS’s image of invincibility. It demonstrated that even in the 21st century, there are Davids, like Banister, who can beat the IRS Goliath.
The question remains: If Banister is correct in his belief that the IRS consistently misapplies the law, who is going to hold the IRS, and officials like Everson, accountable?
(Issue #28, July 14, 2005)
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