Monday, June 26, 2006
Attorney Stephen Yagman Indicted for Tax Evasion
By a MetNews Staff Writer
Venice civil rights attorney Stephen G. Yagman made his first appearance in the U.S. District Court in Los Angeles Friday after being indicted on charges of attempting to evade the payment of more than $100,000 in federal income taxes by concealing his assets and committing bankruptcy fraud.
Magistrate Judge Patrick J. Walsh ordered that Yagman, 62, be released immediately upon signing an unsecured $100,000 bond, to be replaced by a fully secured surety bond in two weeks. Walsh ordered that Yagman surrender his passport, but allowed him to travel throughout the continental United States as long as he first notifies court officials of any plans to leave California.
Yagman’s next hearing date is July 3.
It was disclosed Friday that a grand jury returned a 19-count indictment against Yagman on June 1 including one charge of tax evasion, one count of bankruptcy fraud, and 17 counts of money laundering. The indictment remained under seal at Yagman’s request until a case he was trying concluded last week.
Yagman, who appeared in court suntanned and wearing a pastel pink polo shirt, faces 10 years in federal prison for each money laundering count. The tax evasion and bankruptcy fraud charges each carry a maximum five-year prison term.
“Stephen Yagman is a fighter,” attorney Mark Heaney, representing Yagman along with attorney Barry Tarlow, told the court when arguing that Yagman did not pose a flight risk, and should be released on his own recognizance.
The indictment alleges that Yagman paid only a small portion of federal income taxes which he declared on his personal tax returns for 1994 through 1997, and failed to pay federal corporate payroll taxes owed by his then-law firm Yagman & Yagman, P.C.
Allegedly Concealed Assets
The indictment also alleges that Yagman tried to conceal his assets to thwart the Internal Revenue Service’s collection efforts. Allegedly, Yagman used various bank accounts held in the name of his girlfriend, who has not been indicted, to deposit his own money, including around $776,000 transferred to him by his relatives, and to conduct his own personal financial affairs.
Yagman is also accused of making fraudulent statements in personal and corporate bankruptcy cases he filed in 1999, allegedly to further impede IRS efforts to collect. He failed to disclose that he lived in a 2,800-square foot house near Venice Beach for which he made the mortgage payments and paid property taxes, and for which he deducted mortgage interest on his tax returns.
He also allegedly failed to disclose various personal and brokerage accounts which he controlled but were in his girlfriend’s name, and the receipt of hundreds of thousands of dollars in legal settlements, client payments and attorneys fees that he received in 1999 and 2000.
Kenneth J. Hines, special agent in charge of IRS criminal investigations in Los Angeles, said in a release, “Mr. Yagman’s pattern of deception and illegal conduct, as alleged in this indictment, discredits those who practice law. The public expects attorneys to be honest, to be trustworthy and to show respect for the law.”
Tarlow told reporters after the hearing that Yagman has been invited to speak before Congress next week regarding the need for an independent inspector general in judiciary investigations, but that they might change their minds “after they read your stories.” He said that Yagman has a full caseload.
Yagman has made a career out of suing law enforcement officers for civil rights violation. Among his clients were the children of Emil Matasareanu, who was shot by police during a North Hollywood bank robbery, and, according to the children, was allowed to bleed to death by Los Angeles police officers.
Copyright 2006, Metropolitan News Company