FROM: JUSTICE DEPARTMENT
Friday, February 7, 2014
New Mexico Farmer Sentenced to Prison for Tax Fraud, Fraudulently Collecting Farm Subsidies
Bill Melot, a farmer from Hobbs, N.M., was sentenced to serve 14 years in prison today to be followed by three years of supervised release for tax evasion, program fraud and other crimes, the Justice Department, Internal Revenue Service (IRS) and U.S. Department of Agriculture’s (USDA) Office of Inspector General announced today. Melot was also ordered to pay $18,469,998 in restitution to the IRS and $226,526 to the USDA.
Melot was previously convicted of tax evasion, failure to file tax returns, making false state ments to the USDA and i mpeding the IRS following a four-day jury trial in Albuquerque, N.M. According to court documents and evidence presented at trial and at sentencing, Melot has not filed a personal inco me tax return since 1986, and owes the IRS more than $25 million in federal taxes and more than $7 million in taxes to the state of Texas. In addition, Melot has i mproperly collected more than $225,000 in federal farm subsidies from the USDA by furnishing false infor mation to the agency. Specifically, Melot provided the USDA with a false Social Security nu mber (SSN) and a fictitious e mployer identi fication nu mber (EIN) to collect federal farm aid.
According to court documents and evidence presented at trial, Melot took nu merous steps to conceal his ownership of 250 acres in Lea County, N.M., including notarizing forged deeds and titling the property in the na me of no minees. The evidence also showed that Melot used false SSNs and fictitious EINs to hide his assets from the IRS. Additionally, Melot maintained a bank account with Nordfinanz Zurich, a Swiss financial institution, which he set up in Nassau, Baha mas, in 1992, and failed to report the account to the U.S. Treasury Depart ment as required by law.
Assistant Attorney General Kathryn Keneally for the Justice Department’s Tax Division and Acting U.S. Attorney Steven C. Yarbrough for the District of New Mexico co mmended the investigative efforts of IRS - Cri minal Investigation and the USDA’s Office of Inspector General, as well as Tax Division Trial Attorney Jed Silvers mith and Assistant U.S. Attorney George Kraehe, who prosecuted the case. Assistant Attorney General Keneally and Acting U.S. Attorney Yarbrough also thanked the Cri minal Investigation Division of the Texas Co mptroller of Public Accounts for assistance in prosecuting this matter.