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Pigs on the wing, Inside Ugly Sow Teresa Giudice's Fraud Case: How Her Bankruptcy Filing Led to Criminal Charges
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Liberals At Their Best
Aug 1, 2013, 7:32:08 PM8/1/13
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Joe and Teresa Giudice filed for bankruptcy in 2009 and dropped
their petitions in 2011. So why were the Real Housewives of New
Jersey couple just charged yesterday with, among other things,
trying to hide assets and income during the bankruptcy process?
"When you file for bankruptcy, everything is public," New Jersey
tax attorney Todd Unger, who does not represent either Joe or
Teresa, tells E! News.
"If you have someone that owes back taxes and at some point they
have filed bankruptcy, the government can go and just pull that
bankruptcy record, just like you or I can, and they can start
looking at inconsistencies. 'Well, wait a minute, what's this,
what's that?'" he explains.
READ: Source says Teresa is "in denial" about fraud case,
"acting like everything's fine"
The 39-count federal indictment handed down Monday alleges that
Teresa failed to disclose her real Real Housewives income in her
bankruptcy filing. The criminal complaint charges that both she
and Joe signed agreements in the summer of 2009 to appear on the
Bravo show for $110,000 in compensation, but did not declare
that money over the course of their bankruptcy proceedings,
which began in October 2009 and latest until Dec. 15, 2011.
"The indictment returned [by a grand jury] today alleges the
Guidices lied to the bankruptcy court, to the IRS and to a
number of banks," U.S. Attorney Paul Fishman said in a statement
Monday. "Everyone has an obligation to tell the truth when
dealing with the courts, paying their taxes and applying for
loans or mortgages. That's reality."
And when government agencies such as the Department of Justice
and the IRS pool their resources to make a federal case out of
something (so to speak), there really isn't anywhere to hide.
"These enforcement agencies are powerful in and of themselves,
but when they start coordinating, there's no doubt that [their
power multiples]," Unger notes.
"Most tax cases, by the way, are not your typical ‘Hey, I didn't
pay taxes.' Those are very rare," he says. "Typically they would
come through an audit where the government would say, ‘Wait a
minute, you've got all these assets. How are you affording this,
you didn't receive an inheritance, you didn't receive gifts...'
"When you start reading this and you can see how these different
areas kind of tie together," Unger continues. "'OK, wait,
they're on TV,' and the government researches you. They'll look
online, they'll look on TV, they'll look at public records, i.e.
bankruptcy, deeds that are reported, courthouse records."
And yes, Unger says, the Giudices' celebrity status may have not
have helped them in this case, at least as far as making them
desirable high-profile targets goes.
"These high-publicized cases serve as the best advertisement for
the government," he say. "And, in particular, the IRS. The truth
is, the government loves them. People know when celebrities get
in trouble. And it creates this fear, especially with the IRS."
Teresa's attorney, Henry Klingman, has said publicly that his
client plans to plead not guilty when she is arraigned Aug. 14.
She and Joe were each released on $500,000 bail earlier today.
"It's almost invariably true that in federal criminal cases such
as this one the judge requires each defendant to have their own
attorney," Klingman told E! News today. "It reflects the ethical
rules so the lawyers avoid conflicts of interest. Even if people
are in the same page like a husband and wife, they could
theoretically go in different directions at some point in the
future."
Meanwhile, putting the idea of going to trial and being found
not guilty aside for a moment, Unger predicts that the Giudices
will work out some sort of plea arrangement with the government
that will allow them to avoid the stiffest of penalties attached
to their case.
A bankruptcy fraud conviction could lead to five years in
prison, while one count of wire fraud carries a maximum penalty
of 20 years in prison and a $250,000 fine, and bank fraud and
loan application fraud carry possible 30-year sentences and $1
million fines.
Joe is also accused of failing to report roughly $1 million in
income between 2004 and 2008. A count of failing to file a tax
return carries a possible one-year prison sentence and a
$100,000 fine. Joe is charged with five counts.
http://www.eonline.com/news/444273/inside-teresa-giudice-s-fraud-
case-how-her-bankruptcy-filing-led-to-criminal-charges
their petitions in 2011. So why were the Real Housewives of New
Jersey couple just charged yesterday with, among other things,
trying to hide assets and income during the bankruptcy process?
"When you file for bankruptcy, everything is public," New Jersey
tax attorney Todd Unger, who does not represent either Joe or
Teresa, tells E! News.
"If you have someone that owes back taxes and at some point they
have filed bankruptcy, the government can go and just pull that
bankruptcy record, just like you or I can, and they can start
looking at inconsistencies. 'Well, wait a minute, what's this,
what's that?'" he explains.
READ: Source says Teresa is "in denial" about fraud case,
"acting like everything's fine"
The 39-count federal indictment handed down Monday alleges that
Teresa failed to disclose her real Real Housewives income in her
bankruptcy filing. The criminal complaint charges that both she
and Joe signed agreements in the summer of 2009 to appear on the
Bravo show for $110,000 in compensation, but did not declare
that money over the course of their bankruptcy proceedings,
which began in October 2009 and latest until Dec. 15, 2011.
"The indictment returned [by a grand jury] today alleges the
Guidices lied to the bankruptcy court, to the IRS and to a
number of banks," U.S. Attorney Paul Fishman said in a statement
Monday. "Everyone has an obligation to tell the truth when
dealing with the courts, paying their taxes and applying for
loans or mortgages. That's reality."
And when government agencies such as the Department of Justice
and the IRS pool their resources to make a federal case out of
something (so to speak), there really isn't anywhere to hide.
"These enforcement agencies are powerful in and of themselves,
but when they start coordinating, there's no doubt that [their
power multiples]," Unger notes.
"Most tax cases, by the way, are not your typical ‘Hey, I didn't
pay taxes.' Those are very rare," he says. "Typically they would
come through an audit where the government would say, ‘Wait a
minute, you've got all these assets. How are you affording this,
you didn't receive an inheritance, you didn't receive gifts...'
"When you start reading this and you can see how these different
areas kind of tie together," Unger continues. "'OK, wait,
they're on TV,' and the government researches you. They'll look
online, they'll look on TV, they'll look at public records, i.e.
bankruptcy, deeds that are reported, courthouse records."
And yes, Unger says, the Giudices' celebrity status may have not
have helped them in this case, at least as far as making them
desirable high-profile targets goes.
"These high-publicized cases serve as the best advertisement for
the government," he say. "And, in particular, the IRS. The truth
is, the government loves them. People know when celebrities get
in trouble. And it creates this fear, especially with the IRS."
Teresa's attorney, Henry Klingman, has said publicly that his
client plans to plead not guilty when she is arraigned Aug. 14.
She and Joe were each released on $500,000 bail earlier today.
"It's almost invariably true that in federal criminal cases such
as this one the judge requires each defendant to have their own
attorney," Klingman told E! News today. "It reflects the ethical
rules so the lawyers avoid conflicts of interest. Even if people
are in the same page like a husband and wife, they could
theoretically go in different directions at some point in the
future."
Meanwhile, putting the idea of going to trial and being found
not guilty aside for a moment, Unger predicts that the Giudices
will work out some sort of plea arrangement with the government
that will allow them to avoid the stiffest of penalties attached
to their case.
A bankruptcy fraud conviction could lead to five years in
prison, while one count of wire fraud carries a maximum penalty
of 20 years in prison and a $250,000 fine, and bank fraud and
loan application fraud carry possible 30-year sentences and $1
million fines.
Joe is also accused of failing to report roughly $1 million in
income between 2004 and 2008. A count of failing to file a tax
return carries a possible one-year prison sentence and a
$100,000 fine. Joe is charged with five counts.
http://www.eonline.com/news/444273/inside-teresa-giudice-s-fraud-
case-how-her-bankruptcy-filing-led-to-criminal-charges
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