Tax fraud defendant William Phillips gets year and day in prison
By Peter H. Milliken
The second defendant to be sentenced in a $3 million tax-fraud conspiracy case has received a prison term of one year and one day.
William E. Phillips III, 55, formerly of Youngstown, drew the sentence Thursday from U.S. District Court Judge Patricia A. Gaughan.
He’ll get credit for the time he has been jailed since his June arrest in Los Angeles after he was deported from the Philippines at the U.S. government’s request. His U.S. passport remains revoked.
Phillips earlier had pleaded guilty to conspiracy to defraud the United States.
Judge Gaughan ordered him to make restitution in the amount of $107,518.
The first defendant to be sentenced in this case was Patricia A. Polk, 50, of Youngstown, who drew a 21-month prison term on Jan. 10 and was ordered to pay $324,531 in restitution.
Steven R. Hinz, 41, formerly of Youngstown, who is being detained in Bedford Heights jail, will be sentenced at 9 a.m. Wednesday.
Heather L. English, 43, of Canfield, who is free on a $20,000 unsecured bond, will be sentenced at 11:30 a.m. Feb. 6.
All four defendants pleaded guilty in October.
The indictment says Hinz promoted a scheme to defraud the government by filing false federal income-tax returns claiming large tax refunds using the original issue discount process.
The scheme involved preparation of fictitious IRS forms that falsely reported that financial institutions, creditors and other entities had withheld large amounts of federal income tax on behalf of defendants and other taxpayers with respect to nonexistent income, the U.S. attorney said.
A sentencing memorandum from Phillips’ lawyer, Craig T. Weintraub of Cleveland, called for Judge Gaughan to consider sentencing Phillips to a year and a day in prison.
The memorandum said Phillips is “deeply remorseful” and notes his honorable discharge from the Air Force in 1979, his marketable skills as a master auto mechanic and the fact that he has no prior criminal convictions.
It also says his wife and 2-year-old son live in the Philippines and await his rejoining them there.