My client is too fat for his prison sentence, lawyer says of tax-fraud convict

After a federal court case that moved ponderously under the weight of evidence, with a hefty 36-page ruling calling the U.S. tax code a “bloated and opaque monstrosity,” Tampa resident Stephen Donaldson Sr. was convicted of getting financially fat off the government.

Last week, Donaldson’s attorney argued he was too physically fat for six years in prison.

Curtis Fallgatter, a member of the Florida Bar since 1976, filed a court document objecting to the six-year, four-month sentence Donaldson received for conspiracy to defraud the government and tax fraud.

The grounds? Donaldson’s physical state: five-foot-nine, 273 pounds, 72 years old. The lawyer attached a chart from the Social Security Administration showing the life expectancy for a man of average health is another 13.9 years.

“Mr. Donaldson is not a senior citizen falling within the normal demographics for his age group,” Fallgatter wrote. “As an obese male, his life expectancy can expect to be substantially reduced. Even if he were perfectly healthy and not obese, his life expectancy is only 13.9 years. Thus, the 76-month sentence received by Mr. Donaldson represents almost half of his entire life expectancy (46%), such that, with the current sentence, Mr. Donaldson will spend half of his remaining life under this prison sentence (in addition to spending the last 10 years under the stressful scrutiny of the government). Moreover, if Mr. Donaldson only lives 75% of the average life expectancy (that is, 10.4 years), his 76 month sentence will translate into 61% of his remaining life under this prison sentence.”

U.S. District Court Judge Stephen D. Merryday rejected the motion on Friday.

Donaldson and Duane Crithfield ran a scam in which they sold “Business Protection Plan” insurance against unlikely events as a legal tax shelter. But when they refunded most of the premium and the customers deducted the full premium as a business expense, that turned it into tax fraud. Merryday’s decision used an overabundance of words to poke at the corpulent tax code.

“Consistent with the considered judgment of their advisers, these taxpayers purchased at a steep cost a set of fantastical and superfluous “insurance” policies and in return re-captured control of cash equal to about 85% of the premium paid for each policy,” Merryday wrote. “In other words, the taxpayers accepted the notion that they could reduce the effective, maximum, marginal-income tax rate from about 40% to about 15% by signing a few papers and moving money from here to there, from there to who knows where, and then back again.

“That these mostly honest, educated, and experienced taxpayers and their savvy advisers believed in, and committed money to, this criminal scam presents an irrefutable and deafening reminder of the extent of the public’s cynicism toward the federal income tax code — a bloated and opaque monstrosity.”

This story was originally published October 22, 2017 at 3:34 PM with the headline "My client is too fat for his prison sentence, lawyer says of tax-fraud convict."