FORT WORTH, Texas - A federal jury in Fort Worth, Texas, has convicted Larry Lake on one count of concealment of assets (bankruptcy fraud) and three counts of tax evasion, announced U.S. Attorney Sarah R. Saldaña of the Northern District of Texas. The trial began Monday morning before U.S. District Judge John McBryde.
According to the public court record, Lake is a resident of Colleyville, Texas, and owns and operates several businesses including VIP Finance of Texas, an auto title loan business with branches throughout the Dallas-Fort Worth area; Cash Auto Sales, which handles the auto club memberships for VIP Finance; and is a part owner of Grapevine Drug Mart, a pharmacy in Grapevine, Texas.
Lake faces a maximum statutory sentence of five years in federal prison and a $250,000 fine for each of the four counts in which the jury found him guilty. A sentencing date was not set.
The government presented evidence at trial that the day before Lake filed for bankruptcy in November 2004, he knowingly and fraudulently transferred and concealed more than $3 million held in an E*TRADE account and a Compass Bank account. The funds were subsequently transferred by Lake through a series of bank deposits, wire transfers and cashier’s checks. In addition, Lake utilized a “shell" company to assist in concealing the assets.
Additionally, according to evidence presented at trial, Lake devised a scheme to evade the assessment of his personal income taxes by under-reporting income on his and his spouse’s joint tax returns for the tax years 2006 through 2008. The unreported income was derived from Lake’s businesses, VIP and Grapevine Drug Mart.
Further evidence presented by the government at trial showed that from August 2006 through November 2009, Lake and his spouse agreed to structure more than 1,100 currency deposits, into at least 13 different bank accounts, knowing that structuring was illegal. These accounts were spread among several financial institutions, and the total amount structured during this time period was in excess of $9.3 million. Lake and his spouse created at least two “shell" companies, which were used to open some of the 13 bank accounts used in the structuring scheme.
Lake, according to evidence presented at trial, failed to disclose the structured funds, and the existence of the accounts containing the structured funds, to his income tax return preparer. In addition, Lake failed to report income he received from Grapevine Drug Mart, having told his return preparer that he (Lake) had sold the business during the 2003 calendar year. By willfully withholding this information from his return preparer, the IRS suffered a total tax loss of $4,838,032.
The case was investigated by Internal Revenue Service Criminal Investigation. Assistant U.S. Attorney Brian Poe and Tax Division Trial Attorney Robert A. Kemins are in charge of the prosecution.
Source: U.S. Department of Justice, Office of the United States Attorneys
