To: Sir Auric Goldfinger who wrote (4512 ) 10/2/1999 1:00:00 PM From: StockDung Respond to of 10354
The Caymans, with just 40,000 residents, are home to 580 banks, whose deposits make it the world's fifth-largest banking center. Its secrecy laws make it a haven for shelter money, whether legitimate income or ill-gotten gains, U.S. officials say. Video Producer Admits Tax Evasion By JEFFREY GOLD .c The Associated Press NEWARK, N.J. (AP) - A video producer faces up to five years in prison and hefty fines after pleading guilty to using a Cayman Islands bank to evade as much as $40,000 in taxes over three years. Michelle A. Pruyn admitted Friday she concealed $240,000 at the now-defunct Guardian Bank & Trust Ltd. of Grand Cayman by working with its chairman, John M. Mathewson. Authorities say many others could face similar charges now that Mathewson has pleaded guilty to charges and cooperated with authorities by providing lists of depositors to U.S. authorities. The records exposed perhaps 1,500 U.S. citizens as tax cheats, the FBI said, representing a massive breach of the vaunted bank secrecy of the tiny British colony in the Caribbean. Mathewson opened an account for Ms. Pruyn in the name of Cogan Corp. about 1991, and she deposited income from her video production companies. No evidence exists that Cogan conducted any business, prosecutors said. Ms. Pruyn, 45, admitted that with funds from the Cogan account, she bought a building and had the property held in trust for her children. She filed for bankruptcy in 1996, but did not disclose her interest in the building or the offshore Cogan account, she admitted. Ms. Pruyn, who pleaded guilty to bankruptcy fraud and tax evasion, faces up to five years in prison and $250,000 in fines, as well as an order to pay back taxes and penalties, at sentencing Dec. 21. Citing Mathewson's ''unparalleled'' cooperation, a federal judge in August sentenced him to six months under house arrest, a $30,000 fine and 500 hours of community service. The sentencing revealed that Mathewson had pleaded guilty in March 1997 to charges including conspiracy, money laundering and aiding income tax evasions as part of plea bargains with federal prosecutors in Florida, New Jersey and New York. He could have faced nearly five years in prison. Because of Mathewson's help, the U.S. government has recouped $50 million in back taxes and penalties, and can expect to get a total of $300 million, his lawyer has said. Authorities have not confirmed those figures. The Caymans, with just 40,000 residents, are home to 580 banks, whose deposits make it the world's fifth-largest banking center. Its secrecy laws make it a haven for shelter money, whether legitimate income or ill-gotten gains, U.S. officials say. AP-NY-10-02-99 0242EDT Copyright 1999 The Associated Press.