Walter Anderson (tax evader)

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Walter Anderson is an American telephone entrepreneur who was arrested and charged in the largest tax evasion case in United States history.[1]

[edit] Early life and career

Anderson grew up in Silver Spring, Maryland.[1] He used his mother's maiden name, Anderson, rather than his father's name, Crump, due to a divorce. He later moved to Fairfax, Virginia, where he graduated from Woodson High School in 1971. He did not graduate from college, though he claims to have attended several institutions, including the University of Richmond, Northern Virginia Community College, and George Mason University.[1]

Anderson began his telecommunications career as a salesman at MCI Communications in 1979. He entered into entrepreneurship in the 1980s and 1990s, during which he heavily invested in several telecom companies, which were later sold for large profits.[1] Anderson bankrolled many early private space ventures and paved the way for the "astropreneurs" who followed. His most high-profile space investment was MirCorp, the 1990s start-up that briefly privatised Russia's ageing Mir space station. He reportedly pumped as much as $30 million into the venture.

[edit] Tax evasion case

Anderson was arrested on February 26, 2005 at Dulles International Airport as he was returning from London.[2][3] He was accused of hiding his wealth in off-shore companies in Panama and the British Virgin Islands in an attempt to avoid taxation on his income. The companies reportedly earned nearly $500 million in revenue during a five-year period.[2]

On September 8, 2006, Anderson pleaded guilty to two felony counts of evading taxes and one felony count of defrauding the District of Columbia government in plea agreement. He was sentenced to nine years in prison, and agreed to turn over $200 million in restitution within ten days of sentencing.[3]

As part of the plea agreement, Anderson admitted to hiding $365 million of income by using aliases, shell companies, offshore tax havens, and secret accounts. Anderson also admitted to having earned more than $126 million in 1998, a year that he claimed an income of $67,939 on his federal tax return for which he only paid $495 in taxes.[3]

On June 15, 2007, federal district judge Paul L. Friedman ruled that Anderson would not have to pay $100 to $175 million of his restitution to the federal government due to a typographical error by the government in the plea agreement. In his ruling, Friedman stated that he did not have the authority to "read something into a contract that is not there or to interpret uncertain language in the government's favor". Anderson will still have to pay $23 million in restitution to the District of Columbia government, and the government may sue for the difference in civil court. [4]

[edit] References

  1. ^ a b c d Hilzenrath, David S., Carol D. Leonnig, and Yuki Noguchi. Tax Case Defendant Says Money Was to Do Good. The Washington Post. March 4, 2005.
  2. ^ a b Williams, Pete. Entrepreneur accused of biggest-ever tax scam. MSNBC. March 3, 2005.
  3. ^ a b c Weiss, Eric M. Telecom Mogul Guilty of Tax Scam. The Washington Post. September 9, 2006.
  4. ^ Judge can't fix government's $100 million boo-boo. Associated Press. June 15, 2007.