How does one hide $4m + from the IRS and wife?

I thought this may go in GQ, but I have generalized questions with multiple factual answers and even more guesses. And some of this is legal. I think this is the proper forum.

First things first: My father is a con artist. I have recently broke contact with him (again) for the hurt he’s done to my ex stepmom - the sweetest kindest most generous (and naive) person in the world.

I finally told my ex stepmom that my dad had a family (and baby!) on the side. She is devastated. She has still been paying for his health care and insurance and etc. She is broke. He claims he is, but hides everything in his business or his ex wife (or maybe current 31 year old g/fs) name. He keeps his personal liability very small.

Couple things:
[ul]
[li]She found out that a bank account with her name on it (she opened it, she’s the primary holder, he’s a secondary or something) has seen over $4m go through it in 18 months. Big deposits, then withdrawals a couple days later. I have to ask if they are several small deposits. Some are from casinos - my dad’s a big gambler - but many are just big giant ?s. She didn’t know about this because she opened this account around 2008 and didn’t realize it was being used like this. He had said, open this account and I can give you money through it. He never did. She’d forgotten about it til I told her he had some cash and houses on the side he was keeping from her.[/li]
On Monday, my dad withdrew $175k. Not wrote a check. Withdrew. Money order? Donno.

[li]HOW IN THE HELL…?! Is there some kind of tax liability? Is she going to get into trouble? Doesn’t this have to go on his tax filings? If this is gambling money, it’s income, and I saw their combined tax return a few years ago - it was only about $219k.[/li]
[li]Is it possible he’s gambling big at some casinos and…getting payouts under the radar? The money goes in and it’s gone in a week or less. What the hell? Some are direct deposits to and from Vegas casinos. Most are cash deposits.[/li]
[li]When he split with his ex ex wife (yeah), she had everything cause he kept it all in her name (to avoid paying much child support…sigh…). So the new stepmom (I’ll just call her Stepmom) used her credit to help get his new company going. Many company credit cards are still in her name. He’s using them - all the time - for gas, clothes, food, etc. If she cuts them off, he will just stop paying the balances (over $100k) and she’s liable. Yes? Can she sue him? Is she a creditor? He kept telling her (for the last 4 years) that he just needs a little bit more, just a little bit more time, need to keep his head above water, etc…[/li]
[li]How easy is it to set up offshore accounts and hide them?[/li]
[li]How many personal expenses can a company pay for? He has these LCs that cover his living expenses. Like everything. He’s in the wholesale business, so a birthday present for my son is now a “research expense”. :rolleyes:[/li]
[li]She signed the divorce papers after she got back from overseas in December. I think it’s too late to contest them. But right now, he’s still putting her in debt. Now what? Legal q here - if he lied about assets/holdings, etc., is that fraud? Perjury? She wasn’t very smart and they used the same atty to work it out amicably.[/li][/ul]

My dad is a real con artist, and a rather romantic one. She’s in so much debt now, has no house, no 401(k), nothing. He has 2 Lexuses, a Mercedez-Benz, 2 houses in CA (both owned by one of his LCs - one for him and his secret gf and baby, one for her family), etc.

I don’t know what she can recover, but I told her to get a lawyer STAT. A couple of them - one to help with the divorce issue, one to help with the finances issue.

My dad has been to jail for ‘conspiracy to commit fraud against the US government’. I know he’s money laundering as well, what with his overseas contacts & businesses. He’s a big gambler, but $4m? Some of this money is coming from Vegas. He’s known for shady under the table cash deals. What the f is he doing? And what should SHE do? She doesn’t want to spend her life in jail, but I personally think they need to send him back to Leavenworth with an oiled arsehole.

You know what she’s also so sad about? He took her dog, a stupid toy poodle I hated, and told her it died. Then he gave it to his new girlfriend.

I hate him. I’ll blackmail him if I have to. He’s supposed to pay her family back the $1m over two years and her $400k over two years. By that time, she’ll be $400k+++ in debt.

When they met, she had credit, cash, a stake in her family business, and a house on Redondo Beach. Now she lives in her sister’s house outside of LA and has returned to working as an airline attendant. And she’s broke.

I had a hunch he owned the house his cocktail waitress girlfriend lived in. Plugged in the address at the county assessor’s website, and yup, he owns that one and her brother’s house. It’s under one of his LCs. Both of which were kept from Stepmom at the divorce papers signing a month ago. <sigh> She’s a very nice but naive immigrant (I say this only because it’s a cultural thing, what’s she’s willing to put up with…) who got screwed.

PS In case you were wondering, I grew up poor. Still am.
PPS If you want to help me write a screenplay about my life, I’m all ears.

Can it inlove you killing him and ingeniously beating the rap?

I think you’ve already given her the best advice - lawyer, lawyer, lawyer. I understand they’ve already signed the divorce papers, but maybe they can re-visit the settlement in light of all the things he kept from her.

Since this is about a real life criminal doing real-life crimes with real, actual millions of dollars, I really don’t think you should post so many details about this publicly. In fact, I think you should stop talking about it anywhere at all on the internet, and ask a mod to delete this topic. For your stepmom’s safety AND YOUR OWN. Because with that amount of money, I am thinking he’s one of 2 things: mid-level drug dealer or mafia goon.

Sorry if this sounds overly hysterical, but you never know. Your stepmom was naiver than naive can be. And her ex-hubby was very, very good at what he did.

Well… my grandpa was a bootlegger during Prohibition and a black marketeer during WWII, and some wealthy gentlemen of the community used to take my dad to Atlantic city to play cards for them, but your father’s situation is a little beyond what they were into.

All I can say is don’t do anything illegal yourself, no matter how badly you want to hurt him back. And you might want to ask if John Grisham or David Baldacci or one of those guys needs an idea for a new novel.

I just skimmed the OP so maybe I missed this. But you suggested that some of that money going in and out of the account was gambling winnings. Wouldn’t any legitimate casino only pay the money with a 1099 or W-2 filed? And if so, can’t the money be garnished?

The divorce papers may be signed, but most jurisdictions require a waiting period before the divorce is final. What you’re talking about sounds like major fraud and I would be very surprised if the court can’t revisit things.

Your advice to lawyer up was a very good one.

Yes, plus you can’t ‘win’ that much gambling on a regular basis .Casinos aren’t set up to give out money to gamblers over the long term especially that much with relatively little reported income. Based on what you posted, you are looking at some serious criminal activity and possibly ties with organized crime. That is the only plausible explanation.

Tell your stepmother to get the lawyers, stay far, far away yourself and be ready for some revelations and shocks in the future maybe including a trial with a long prison sentence. I wouldn’t post anything else about this either. It so so far outside of the norm that you can’t get any useful advise other than what we have already said and you already know.

If you had chips, you could cash out several small times and go under the radar. He was also dating one of the GMs in a Vegas casino.

Well hell this keeps getting better and better, in any case you know your father and if his own son can’t think of a way to account for this what does that leave besides crime?

Daughter.

I’m sure it is crime - the white collar variety in which he screws over wealthy women.

I did ask a mod to delete this. I don’t know if it will be deleted. I was kind of hoping someone had answers to a few of my qs, though, re: taxes and bank accounts.

Not only does she need to lawyer up, she needs to open a second account and tie it to the first. Then watch the first and as soon as money shows up in it, transfer it to the second where he can’t get at it.

And yet, ex step mom has not attempted to close this account or get her name off it. She may be nice, she may be naive, but that doesn’t cut much ice in court.

She found out yesterday, I think. If he makes a $$$ deposit next week, she will withdraw it and give him the middle finger. I hope. But she’s afraid of making him mad. Plus he keeps emotionally blackmailing her with this “I’m suicidal” BS. He also owes money on credit cards in her name (for his company). So if he stops paying…

I think you are exactly correct, organized crime. Some people think it exists only in the movies, and they are wrong.

(bolding mine)
So, so true. I’m wondering if CitizenPained has ever noticed if her Dad sometimes wears a ‘pinkie’ ring, like the kind you might see on a ‘wiseguy’.

I know that it’s a cliche, but it didn’t become one for no reason at all. :wink:

Re the OP you seem to be conflating 4 million in cash flowing through an account with 4 million dollars in earnings the IRS would be concerned about. There are plenty of legit businesses that have huge cash flows and report little if any profit due to the nature of the business being successful or unsuccessful. The IRS isn’t necessarily going to ring any alarm bells if the purported nature of the business and the tax paperwork it submits lines up with accounting expectations.

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It was a personal account. And it’s an account that gets a large amount deposited (cash) and withdrawn after it (cashier’s checks) clear. Like, within a week.

This is a personal account in the name of the wife of the guy using it, a business big enough to have 4 million in revenue would not need to use someone’s personal bank account.

How is your father withdrawing cash from this account, and in such large amounts? Is it a joint account? I can’t believe a bank would let a guy take out more than a hundred grand in cash from an account not in his name and stroll out the door. :dubious:

Your mother needs to take steps to protect herself NOW, as far as any law enforcement is concerned she looks like an accomplice. She opened this account thats being used for god knows what, don’t expect them to believe her story.

She needs to go to the bank pronto and find out who these checks and deposits are from, she needs to find out where the money is going or how its being withdrawn.