Atty Jailed For $7B Tax Fraud Seeks COVID-19 Release

By Kevin Penton
Law360 is providing free access to its coronavirus coverage to make sure all members of the legal community have accurate information in this time of uncertainty and change. Use the form below to sign up for any of our daily newsletters. Signing up for any of our section newsletters will opt you in to the daily Coronavirus briefing.

Sign up for our Illinois newsletter

You must correct or enter the following before you can sign up:

Select more newsletters to receive for free [+] Show less [-]

Thank You!



Law360 (April 13, 2020, 10:08 PM EDT) -- An ex-Jenkens & Gilchrist lawyer sentenced to 15 years in prison for orchestrating a $7 billion tax fraud scheme wants a New York federal court to allow him to swap a cell for his home because of the novel coronavirus, arguing that to leave him imprisoned amounts to a "death sentence."

Paul Daugerdas on Friday urged the Southern District of New York to allow him to serve what he anticipates will be his remaining seven years of confinement inside his home, saying he is a 69-year-old ex-smoker who suffers from diabetes, high blood pressure and elevated cholesterol.

Daugerdas has been incarcerated since 2014 and expects to be released in July 2027 due to his age, according to a memorandum he filed on Friday with the court. He asserted that converting sentences to home confinement for "elderly inmates seems a lot more practical, cost-effective and humane in a just society" and should not be interpreted as the court going "soft on crime," according to the memorandum.

"Given his age and these medical conditions, we are extremely concerned that when [and not if] the COVID-19 virus spreads through the facility… it may be a death sentence for Mr. Daugerdas," the memorandum said.

Prosecutors claimed Daugerdas created and implemented four tax shelters for wealthy clients that resulted in more than $7 billion worth of fraudulent tax deductions or benefits. He personally reaped $95 million from the scheme, according to the government.

Daugerdas was convicted at trial in 2011, but the verdict was overturned after evidence of juror misconduct emerged. He was tried again in October 2013 and convicted on seven of 16 counts he faced, including conspiracy, tax evasion and mail fraud.

U.S. District Judge William Pauley handed down the sentence in June 2014, saying Daugerdas would be remembered as "the architect of the greatest tax fraud in U.S. history."

"Daugerdas is in a class by himself," the judge said at the time. "He was at the apex of tax shelter fraud racketeers."

Counsel for the parties could not be reached for comment on Monday.

The federal government is represented by Stanley J. Okula Jr. of the U.S. Attorney's Office for the Southern District of New York.

Daugerdas is represented by Henry E. Mazurek and Ilana Haramati of Meister Seelig & Fein LLP.

The case is U.S. v. Daugerdas et al., case number 1:09-cr-00581, in the U.S. District Court for the Southern District of New York.

--Editing by Janice Carter Brown.

For a reprint of this article, please contact reprints@law360.com.

Attached Documents

Useful Tools & Links

Related Sections

Case Information

Case Title

Related  Case: 


Case Number

1:09-cr-00581

Court

New York Southern

Nature of Suit

Judge

William H. Pauley, III

Date Filed

June 09, 2009

Law Firms

Government Agencies

Hello! I'm Law360's automated support bot.

How can I help you today?

For example, you can type:
  • I forgot my password
  • I took a free trial but didn't get a verification email
  • How do I sign up for a newsletter?
Beta
Ask a question!