Indictment accuses Arizona land developer of using Panhandle ranch to hide assets
An Arizona federal indictment alleges that a large Panhandle ranch at the center of a raucous land war was secretly owned and leased by a wealthy Arizona land developer who was using the cattle operation to hide assets and evade taxes.
KENTON — An Arizona federal indictment alleges that a large Panhandle ranch at the center of a raucous land war was secretly owned and leased by a wealthy international land developer from Arizona who was using the cattle operation to hide assets and evade taxes.
The eight-count indictment issued last June also alleges that as part of the tax evasion scheme, land developer James R. Parker of Carefree, Ariz., used his son and a limited liability ranch corporation as “straw buyers” for a $306,695 Rolls-Royce automobile that was delivered to his personal residence in Arizona.Parker denies wrongdoing.
“That’s just a bunch of (bull),” Parker said in a telephone interview. “It’s just estate planning and they made a big ol’ friggin’ international story of intrigue out of it.”
The tax indictment adds an additional twist to a Wild West–style drama playing out on the parched mesas and panoramic plains at the tip of the Oklahoma Panhandle.
The Oklahoman last Sunday quoted Parker’s 28-year-old son, Samuel, as accusing locals of killing his dog, cutting his fences, sabotaging his windmills and firing shots over the heads of ranch workers in a dispute over land he was leasing from the state.
Samuel Parker said the land war started because he outbid everyone for the lease of more than 24,000 acres of state school lands in a part of Cimarron County where such lands had been leased by certain families for generations.
He contends the Oklahoma Commissioners of the Land Office should have been thrilled with his willingness to pay $273,600 a year in lease payments — much more than the agency had been receiving. Instead, he claims agency employees aligned themselves with local ranchers, made a detrimental land swap involving a portion of his leased land and even went so far as to tell an Oklahoma County judge it was their intention to “run these people out of Cimarron County.”
Agency officials denied the land swap was detrimental to Samuel Parker’s ranching interests. A lawsuit is pending over the dispute.
James Parker said this week he suspects the agency instigated the Internal Revenue Service criminal investigation that led to his tax indictment.
Keith Kuhlman, director of the land office’s real estate management division, denied instigating the IRS investigation, but acknowledged being interviewed about Parker by an IRS agent on April 1, 2008.About the indictment
The indictment accuses James Parker of carrying out elaborate schemes to hide assets and evade paying more than $1.2 million in taxes, penalties and interest.
The elder Parker and his wife agreed more than seven years ago to pay more than $1.2 million in taxes and penalties following a tax audit covering the years 1997 and 1998, but never paid any of that back, the indictment states. Nor did they pay an additional $465,860 in interest, it states.
The indictment describes him as an owner and chief executive officer of a foreign land development company that was paid about $6 million for the sale of 597 prime acres in Belize, a Central American tourism mecca.
The indictment claims the elder Parker directed that money from the sale be deposited in a Belize bank, and that more than $3.4 million of the funds were subsequently wire transferred to the United States for his benefit, including more than $2.8 million that went into Cimarron River Ranch accounts to support the Panhandle cattle operation and about $306,000 that was used to purchase the Rolls-Royce.
The indictment claims that other than nominal amounts which flowed through a consulting company account, none of the more than $3.4 million of “repatriated funds from the Belize land sale were reported on the defendants’ U.S. Individual Income Tax Returns (Form 1040), as required by law.”
It also alleges he attempted to disguise his “true ownership and control” of his $1.5 million Carefree, Ariz., residence, a $1 million home in Amarillo, Texas, the Rolls-Royce, and the Oklahoma cattle operation by placing their ownership in limited liability companies purportedly owned by his children.
The indictment described his son, Samuel Parker, as the “straw owner” of Cimarron River Ranch and “straw buyer” of the Rolls-Royce.
The indictment also claims that James Parker and his wife, Jacqueline, made false statements to the IRS concerning their assets, income and ability to pay in an effort to negotiate a lower tax settlement.
“The defendants falsely and fraudulently stated to the IRS ... that they were unable to pay their rent, were impoverished, and would be homeless if not for the kindness and support of their two children,” the indictment said. The couple actually has three children.Parker’s explanation
James Parker said the limited liability corporations established by his children were all legitimate corporations established to protect assets and for estate planning purposes.
“They’re not straw corporations,” he said. “I did that because I’m 63 years old, I’ve been involved in real estate development and business risk all my life and now I’m reaching an age where I can’t go back and do it again, my kids are grown and I wanted them to have something if for any reason something happened to me. They wouldn’t be able to operate these foreign corporations and I wanted to have something in the U.S. to give them a base upon which they could build their own careers and their own businesses.”
He said the transfers from the Belize bank to his son’s Cimarron River Ranch account were loans from a foreign corporation that were to be paid back when the ranch became profitable. The ranch lost money every year, he said.
Central to the dispute is the IRS’s contention that it was Parker’s personal funds that were wired from the Belize bank’s foreign corporation account to various accounts controlled by Parker family members in the U.S.
James Parker said he had signatory authority over the account, but the money wasn’t his.
“I worked for the foreign corporation and they alleged that I own it,” he said. “There’s a bunch of partners in the deal. ... I didn’t own it. Working for a foreign corporation and being compensated is different from owning it. I was the general manager. It was that same corporation that lent my son these funds.”
James Parker said the $306,695 Rolls-Royce was purchased to help promote a plan to join with other investors to purchase a 30,000- acre Cimarron County ranch and then subdivide about half the acreage into what he called “40-acre ranchettes.” That deal fell through.
Read more: http://newsok.com/indictment-accuse...ide-assets/article/3552120#ixzz1Hu4PyKxO