Santa Monica Attorney Pleads Guilty To Fraud Charges
Scheme evaded more than $1 million in tax, more than $900,000 in misappropriated client fees
Posted Jan. 26, 2012, 3:34 am
The owner of Robert M.L. Baker III Law Offices in Santa Monica pleaded guilty in U.S. District Court on Tuesday before Judge Otis D. Wright to willfully subscribing and filing false tax returns in a conspiracy to commit tax fraud, wire fraud, and mail fraud.
Robert M.L. Baker III admitted that he along with others devised a scheme to misappropriate client fees and settlements in order to evade payment of tax.
According to the plea agreement, the 46-year-old utilized shell entities and trusts to hide over $900,000 in client fess and assets from the Internal Revenue Service, including a house located in Westwood.
Baker also submitted a false offer and compromise form by mail and filed false tax returns with the IRS in attempts to evade over $1Million in tax.
In furtherance of the conspiracy, Baker altered his banking practices. Baker used nominee bank accounts, converted client fees into cashier’s checks to pay personal expenses, altered and cashed checks, and directed clients and other law firms handling clients to mail and wire funds to nominee bank accounts.
As part of the plea agreement, Baker agreed to file amended corporate and individual tax returns correctly reporting gross receipts and deductions. Baker also agreed to make restitution in the amount of $2,108,175.
At sentencing, Baker faces a total maximum sentence of 26 years of incarceration; a three year period of supervised release; a fine of $2 million plus twice the gross gain or loss, whichever is greatest, and a mandatory special assessment of $800, as well as the cost of prosecution.
The investigation was conducted by the Internal Revenue Service-Criminal Investigation and U.S. Postal Inspection Service.