A federal judge ordered a man convicted of tax-related offenses back to jail for 30 days Wednesday for violating terms of his court-supervised release.
Richard James Basuel would have completed this month his three years of supervised release, which followed a 40-month federal prison term for conspiracy, fraud and making false statements in connection with tax returns he filed on behalf of clients through his tax preparation company, RB Tax Service.
But visiting U.S. District Judge A. Wallace Tashima found Wednesday that Basuel lied to his probation officer by not disclosing that his wife runs her own tax preparation business and not disclosing $16,500 he received last year when he cashed in two life insurance policies.
Tashima also ordered Basuel, 70, to serve one more year of court-supervised release.
Basuel’s lawyer, Reginald Minn, said Basuel didn’t lie about his wife’s business.
"He was telling (the probation officer) some of what his wife was doing, not everything. He simply left that part out," Minn said.
Basuel told Tashima he didn’t disclose his wife’s business because "I was scared they might pick on her again." He said he also did not know he had to report the insurance money.
One of the conditions of Basuel’s post-incarceration supervised release is that he report all income and other cash inflows, said federal prosecutor Les Osborne Jr.
A jury found Basuel guilty in 2005 of the conspiracy, fraud and false statement charges. Three of his employees, including his son Richard James II, earlier pleaded guilty to conspiracy.
The government said Basuel told his clients the wages they earned in Hawaii are not subject to taxation under state and federal laws, so they are entitled to a refund of all the taxes withheld by their employers.
The scheme allegedly resulted in the payout of more than $4 million by just the federal government in falsely claimed returns.
RB Tax Service was at one time one of the largest tax preparers in the state.