Yoga classes, Mardi Gras season expenses and a music streaming service were among the purchases Orléans Parish District Attorney Jason Williams claimed on his law firm’s federal tax returns. attorneys, prosecutors said Friday, contributing to the $765,258.85 in inflated business expenses they allege put forward. reduce its tax burden over five consecutive years.
But none of these expenses show that Williams did anything other than completely trust his tax preparer, Henry Timothy, an avowed tax cheat, to select legitimate expenses from a comprehensive list of purchases and produce specific statements, defense attorneys argued.
Williams and his co-defendant, attorney Nicole Burdett, are charged in a 10-count indictment alleging they conspired for five years to inflate Williams’ business expenses at his private law practice, reducing his tax liability of approximately $200,000. Burdett is separately charged with skimming $130,000 off her own tax bills.
The two are also accused of failing to complete the proper forms for large cash receipts.
page after page
On the document-laden fifth day of the defendants’ trial in U.S. District Court, prosecutors posted page after page of the expenses of IRS agent Timothy Moore, who led the investigation into Williams and Burdett, to review . He was asked to testify which were inflated or not eligible business purchases, such as clothing, dry cleaning or personal life insurance.
In his cross-examination of Moore, defense attorney Billy Gibbens said Williams does not dispute that most of those expenses had no place in his statements. But Gibbens argued that Williams, who was a city council member at the time of the alleged crimes, turned over all of his expense documents to Timothy, trusting the tax preparer to report only appropriate purchases.
Gibbens asked if Moore’s investigation produced any emails showing Timothy sent draft tax returns to Williams or Burdett for review before filing them online. Timothy testified Thursday that he did, but Moore said Timothy did not provide those communications.
No further interviews
Gibbens showed documents that in 2014, one of the years Williams is accused of falsifying his own business expenses, Timothy filed 1,141 tax returns for clients. Of these declarations, 392 included an Annex C, the document on which companies declare their expenses.
“You didn’t attempt to identify or interview any of those other customers, did you?” Gibbens asked, indicating that those clients could have corroborated or disputed Timothy’s testimony.
Moore replied, “I wasn’t investigating any of these individuals.”
Attorney Gregory Sauzer and Williams’ ex-wife Bridget Barthelemy, daughter of former New Orleans Mayor Sidney Barthelemy, also took the witness stand on Friday.
Sauzer, who worked at Williams’ law firm from 2015 to 2018, said he accepted cash payments from clients and the firm sometimes paid him in cash. He said he turned down an offer to use Timothy as a tax preparer, because Timothy’s situation seemed “strange.”
But he later admitted he initially told IRS investigators he declined to use Timothy’s services not because it seemed odd, but because he had his own tax preparer. at the time.
Barthelemy said that during their marriage, which ended in 2018, she often went to Williams’ office to withdraw money from his safe for personal expenses, such as groceries. , and that Williams often paid for things in cash, rather than a credit or debit card.
Defense attorneys asked if Barthelemy could provide evidence to corroborate that she collected money at the office.
“I might be able to do it, if someone asked me,” Barthelemy said. “But nobody ever asked me.”
Other tax issues
Sauzer and Barthelemy face their own tax problems.
Prosecutors accused Barthelemy of failing to file a tax return; they did so via an informational statement, a sign that she has agreed to plead guilty and is cooperating with the government. She is due to enter her plea on July 27, according to court records.
Sauzer is charged with four counts of willfully failing to file federal returns over four consecutive years ending in 2018. In February, he signed a plea deal that, if accepted by a judge, would void three of the charges brought against him.
Next week, prosecutors are expected to call another attorney, Robert Hjortsberg, who also worked for the Williams firm, and who pleaded guilty in March to a misdemeanor charge of willfully failing to file a federal tax return. .
Moore will also return to the stand on Monday as cross-examination of his testimony continues.
The lawyers told Judge Lance Africk on Friday that they hoped the trial would end next week.