Former United States Tax Court Judge and Husband Indicted for Conspiracy to Commit Tax Evasion and Obstrution of an IRS Audit

former Judge Diane L. Kroupa

According to the United States government, "U.S. Attorney Andrew M. Luger for the District of Minnesota today announced a federal indictment charging Diane L. Kroupa, 60, and her husband, Robert E. Fackler, 62, with conspiring with each other to evade assessment of taxes.  Each defendant is charged with conspiracy, tax evasion, making and subscribing false tax returns and obstruction of an Internal Revenue Service (IRS) audit.  The defendants are expected to appear later this week in U.S. District Court in Minneapolis, Minnesota.

“The allegations in this indictment are deeply disturbing,” said U.S. Attorney Andrew Luger.  “The tax laws of this county apply to everyone, and those of us appointed to federal positions must hold ourselves to an even higher standard.”

“As a former tax court judge, Kroupa dealt regularly with individuals who cheated on their taxes, which makes these allegations particularly troubling,” said Chief Richard Weber of the IRS-Criminal Investigation.  “Reporting personal expenses as business expenses on your tax returns is not tolerated, regardless of your job or position. We expect all taxpayers to follow the law –whether you are a business owner, individual, or government official – we all must play by the same rules and pay our fair share.”

According to the indictment and documents filed in court, between 2004 and 2012, Kroupa and Fackler conspired to evade their tax obligations.  Kroupa was appointed to the U.S. Tax Court on June 13, 2003, for a term of 15 years, but she retired on June 16, 2014.  During the same period, Fackler was a self-employed lobbyist and political consultant who owned and operated a business known as Grassroots Consulting.  From 2004 to 2013, Kroupa and Fackler owned a home in Minnesota.  From 2007 to 2013, they also leased a second residence in Maryland.

According to the indictment and documents filed in court, as part of the conspiracy to defraud the United States, Kroupa and Fackler fraudulently claimed personal expenses as Grassroots Consulting business deductions.  They fraudulently claimed the following personal expenses as deductible business expenses: rent and utilities for the Maryland home; utilities, upkeep and renovation expenses of the Minnesota home; pilates classes; spa and massage fees; jewelry and personal clothing; wine club fees; Chinese language tutoring; music lessons; personal computers; and expenses for vacations to Alaska, Australia, the Bahamas, China, England, Greece, Hawaii, Mexico and Thailand. "

Robert Fackler memo....

What were they thinking that they were going to get away with this? And this is a former Tax Judge...If this allegation is true, this is tremendous chutzpah.

The story says they evaded more than 400,000 in taxes. Will they end up in jail? It depends. If they go to trial and lose, most likely they will. If they take a plea, they may end up with probation or a minimum amount of jail time which I would give an educated guess of  say up to two years.

Of course, the government has to make a lesson out of them because if a judge and especially a tax judge does not respect the tax laws, why should an ordinary citizen?

This is what to expect if they end up in Prison....  http://www.amazon.com/PRISON-expect-Federal-Bureau-Prisons-ebook/dp/B011GTWLOG