Monday, July 02, 2012

Religious Tax Evasion Convictions, Sentences, Upheld

US v. Jinwright: Anthony Jinwright became the senior pastor at a North Carolina church in 1981.  By the time his wife (and codefendant) Harriet joined him as a pastor in 2000, he was making a six figure income, not to mention a luscious benefits package.  Between 2001 and 2007, Anthony earned a total of $3.9 million in wages and benefits, while Harriet made nearly $1 million.  Unfortunately, not all of that income was reported to the IRS, which estimated that they underpaid by more than $650,000 in that time.  Both Jinwrights were convicted of conspiracy to defraud the Government and tax evasion, with Anthony convicted of several additional counts of tax evasion and filing false tax returns.  Anthony was sentenced to 105 months in prison, Harriet to 80 months.

The Jinwrights challenged both their convictions and sentences on appeal, all of which were affirmed.  As to the convictions, they raised three arguments.  First, they argued that the district court erred by giving a willful blindness instruction, both because the evidence did not support it and the legal standard presented in it was incorrect.  The court disagreed, holding that the evidence supported the instruction and that it properly warned the jury that it could not convict if the Jinwrights were simply reckless or foolish in overlooking what was happening.  Second, the Jinwrights argued that a jury instruction on the tax treatments of payments from employer to employee directed the jury to find particular facts, namely that the Jinrights received payments that they were required to report as income.  The court disagreed.  Third, they argued that the district court improperly limited their cross examination of three witnesses who believe that payments from the church to the Jinwrights were gifts.  The court found the limitation was a reasonable precaution to prevent jury confusion.

As to sentencing, Harried challenged her tax loss calculation, arguing that included funds from a year for which the jury acquitted her of evasion.  The court disagreed, noting that the use of acquitted conduct at sentencing is permissible and concluding that the district court's findings were sufficiently explained.  Both Jinwrights challenged the amount of restitution they were ordered to pay, arguing that it included sums  based on losses that occurred prior to the conduct for which they were convicted.  The court concluded that the district court could order restitution based on losses caused by the acts in the conspiracy, even if the defendant was not convicted for each of the acts.  Finally, the Jinwrights both argued that the district court erred in imposing two Guideline enhancements.  One was for the use of sophisticated means, which the court held was justified based on the Jinwrights use of multiple organizations and "a variety of sophisticated techniques" laid out in the PSR.  The other was for abuse of a position of trust, which the court affirmed on the basis of "the wide range of conduct in the record," including having access to church finances.

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