These special-editions Quatloos commemorates those who have made a name for
themselves in their particular business endeavors.
Our 100Q Woopoo chip commemorates notorious tax scam artists.
Usually it isn't difficult to figure out where these crooks are coming from,
but occasionally there is the exception.
Alleged "former" IRS-CID agent Joseph Banister
is a regular speaker at "tax protestor" events and has published
the book "Investigating the Income Tax". In just a couple of years,
Banister has emerged as the poster child of the de-tax gurus, appearing
on national TV
interviews -- where, amazingly, he admits that he himself reports and pays
his income tax, although advocating to others that the payment of income
But it gets even stranger: Many of the "tax protestor"
gurus are convinced that Banister is simply a plant and is still working for
the IRS-CID in an attempt to infiltrate the de-tax industry. Pat Shannan, who
lingers on the periphery of the tax protestor crowd, claims
that Larry Becraft has warned that Banister is still an IRS-CID agent and a
"Trojan Horse" to infiltrate the business. According to Shanna, Becraft
purportedly told Bill Benson, "I don't care what he says, Bill, he's still
a !@#$% IRS agent, and I don't trust him!"
Fellow Quatlooser Otto Skinner has proclaimed Banister to
be an undercover IRS plant, see http://www.ottoskinner.com/
Nobody even knows if Joseph Banister is this guy's real name.
Few IRS agents use their real names when on duty, because of fear of retaliation
by citizens whom they have crossed. And, Banister burst onto the scene in 1999
when the IRS was just realizing that it had a significant problem with tax protestors,
so the timing is pretty suspicious.
Banister's website is http://www.freedomabovefortune.com
where he sells The Banister Report and gives out his free report "Investigating
the Federal Income Tax". Banister claims to have been inspired by
fellow tax scam artists and Quatlosers Bill Conklin and Devvy Kidd. Banister
seems to show up with Conklin and Kidd at speaking events, along with another
Quatlooser, Bill Benson. We suspect Banister is one of two things: (1) an ex-IRS
agent who figured out that he could make a lot more money selling de-tax books
and stuff than he could working for the governent, and who believes that so
long as he pays his own taxes the U.S. government can't do much about it as
long as he throws in the appropriate disclaimers into his materials (which he
does) and thinks that the suckers dumb enough to believe him get what they deserve;
or (2) he is -- as many in the tax protestor movement suspect -- a plant. Our
bet is on the first.
Otto Skinner says that Conklin
and Banister are just flat wrong, see http://www.buildfreedom.com/
On June 23, 2005, a jury acquitted Joe Banister of multiple counts of
assisting Al Thompson file a fraudulent tax return. Banister's position
was that as a then-member of the federal tax bar (he has since been disbarred)
he was privileged to assist Al Thompson in preparing what is known as
a "protest return".
Al Thompson, one of the USA Today posterboys for Bob Schulz's We The
People organization, was convicted of failing to withhold paychecks from
the employees of his Cencal Aviation, and is currently serving a six-year
sentence. The Banister acquittal will not help Thompson's appeal.
Interestingly, Banister's attorney admitted that Banister had been paying
his federal income taxes (which was apparently why he was not charged
with tax evasion), and repeatedly referred to Al Thompson as a "liar" and "convicted
Contrary to the claims of some tax protestors, this case did not even
involve the question of the liability for federal income taxes, and did
not in any way establish a right to not file tax returns or pay taxes.
But with the tax protestor movement losing many significant cases in
recent months (Meredith, Simkanin, Thompson, etc.) they'll grasp at even
FOR IMMEDIATE RELEASE Contact: Patty
November 18, 2004
CERTIFIED PUBLIC ACCOUNTANT AND REDDING BUSINESS
OWNER CHARGED IN
SACRAMENTO--United States Attorney McGregor W. Scott and
IRS Criminal Investigation Special Agent in Charge Roger L. Wirth announced
today that a federal grand jury has returned a seventeen-count indictment charging
JOSEPH BANISTER, 41, of San Jose, California and WALTER A. THOMPSON, 57, of
Redding, California with multiple tax crimes.
BANISTER and THOMPSON each are charged with one count of
conspiring to defraud the United States by impairing and impeding the Internal
Revenue Service with regard to approximately $259,669 in income and employment
taxes during the period of July, 2000 through December 31, 2002. In addition,
BANISTER is charged with three counts of aiding and assisting the filing of
false tax returns for THOMPSON for the 1996, 1997 and 1998 tax years.
In addition to the conspiracy count, THOMPSON is charged
with two counts of filing false claims with the IRS, one count of filing a false
income tax return with the IRS, and ten counts of willfully failing to collect
and pay over approximately $176,215 in taxes from the wages and salaries of
This case is the product of an extensive investigation by
the Internal Revenue Service, Criminal Investigation Special Agents.
According to Assistant United States Attorneys Robert M.
Twiss and Carolyn K. Delaney, who are prosecuting the case, the indictment alleges
that THOMPSON owned and operated Cencal Sales ("CENCAL"), an aviation
flight bag manufacturing business located in Shasta Lake, California. CENCAL
employed a number of hourly wage workers who were predominantly seamstresses,
production managers or office workers.
BANISTER, a Certified Public Accountant ("CPA")
and former Special Agent in the Criminal Investigation Division of the Internal
Revenue Service, is alleged to have entered into a conspiracy with THOMPSON
to remove employees of CENCAL from the taxpayer rolls by no longer withholding
employment taxes from wages and salaries, not filing Employer's Quarterly Tax
Returns, Form 941, and not providing the employees or the IRS with annual wage
or other income statements, Forms W-2 or 1099, as required by law.
The conspiracy count alleges that on July 21, 2000, THOMPSON
falsely advised CENCAL employees that the compensation which they received in
return for their labor was not "income" within the meaning of the
internal revenue laws and that they were not required to pay individual income
taxes on the compensation which they received from CENCAL. THOMPSON stopped
withholding income and employment taxes from his employees in July of 2000,
and stopped filing Employers' Quarterly Tax Returns and Forms W-2 at the same
The indictment further alleges that there was a second meeting
on October 11, 2000 at which THOMPSON and BANISTER again falsely advised CENCAL
employees that the compensation which they received was not "income"
and that they were not required to pay individual income taxes on those wages.
BANISTER assured the employees of CENCAL that THOMPSON would not lie to them
regarding the tax issues.
The indictment further alleges that BANISTER prepared false
Amended Individual Income Tax Returns, Forms 1040X , for THOMPSON and his spouse
for 1996, 1997 and 1998. THOMPSON had filed returns for these three years, reporting
over $300,000 in total income for the three years and substantial taxes. The
amended returns purported to reduce the amount of income and tax in each year
to $0, and sought refunds of approximately $65,000 for 1996 and 1997, and to
eliminate a tax liability in the amount of $15,500 for 1998. THOMPSON signed
and filed the fraudulent amended returns with the Internal Revenue Service at
the Fresno Service Center.
Ten counts of the indictment charge THOMPSON with willfully
failing to deduct, collect, account for and pay over to the IRS those federal
income and employment taxes due on the wages paid to the employees of CENCAL
between July 1, 2000 and December 31, 2002.
"The blatant and far-reaching defrauding of honest
taxpayers by these two individuals warrants an aggressive federal prosecution.
This case should serve as a stark reminder to our citizens that caution should
be heeded when approached by those advocating wild theories as to why one does
not have to obey federal tax laws," stated United States Attorney Scott.
"Joe Banister, a former IRS agent, knew exactly
what he was doing. Tax professionals and employers who break the law will be
held accountable," said IRS Commissioner Mark W. Everson.
According to IRS Criminal Investigation Special Agent in
Charge Roger Wirth, "Taxpayers shouldn't be taken in by false descriptions
of the law or misrepresentations of the facts. Dozens of taxpayers were adversely
affected by the actions of Mr. Banister and Mr. Thompson."
If convicted of all counts with which they are charged, the
maximum penalty to which defendant BANISTER could be sentenced is imprisonment
for 14 years and a fine of $1,000,000. The maximum penalty to which defendant
THOMPSON could be sentenced if convicted of all counts is imprisonment for 68
years and a fine of $3,500,000.
The charges are only allegations and the defendants are presumed
innocent until and unless proven guilty beyond a reasonable doubt.
CPA’s Appeal of Disbarment Denied
IR-2004-93, July 13, 2004
WASHINGTON — The Treasury Department has denied the
appeal of Joseph R. Banister from an administrative law judge’s decision
that Banister be disbarred from practice before the Internal Revenue Service.
Banister is a Certified Public Accountant from San Jose and former IRS criminal
The IRS Office of Professional Responsibility, in a complaint
against Banister, alleged that he was misrepresenting the law to taxpayers and
that he failed to file his own federal income tax returns for tax years 1999-2002.
OPR investigates allegations of disreputable conduct and incompetence against
tax practitioners and enforces the standards of practice for those who represent
taxpayers before the IRS, as detailed in Treasury Department Circular 230.
Judge William B. Moran in a Dec. 24, 2003, decision found
that Banister provided erroneous advice to taxpayers, including improperly advising
them that returns were not required because Sections 861 through 865 of the
Internal Revenue Code define “source of income” in a manner which
excluded the income of U.S. citizens residing in the U.S. from U.S. tax. Banister
also provided erroneous advice that they were not required to file returns because
the 16th Amendment to the Constitution was not properly ratified. The original
complaint against Banister was later amended to charge Banister with not filing
his own returns for tax years 1999-2002.
Banister filed an appeal of the judge’s decision with
the Department of the Treasury, citing numerous alleged errors. In a decision
dated June 25, 2004, David F.P. O’Connor, acting under a delegation from
the Secretary of the Treasury, affirmed Judge Moran’s decision regarding
erroneous advice to taxpayers. O’Connor found that the Office of Professional
Responsibility had not met its burden of proof with respect to the charge that
Banister had failed to file his own returns. He did not send the case back to
Judge Moran for further proceedings, during which the Office of Professional
Responsibility could have introduced the required additional evidence, because
O’Connor agreed with Judge Moran that the charges related to erroneous
advice to taxpayers alone warranted disbarment from practice before the IRS.
In rejecting Banister’s claim that his advice to clients
was protected speech, and that sanctions under Circular 230 should not restrain
zealous advocacy on behalf of taxpayers, O’Connor said “zealous
advocacy does not constitute license for the assertion of frivolous positions.”
O’Connor noted a number of court decisions in which Banister’s positions
on Section 861 and the 16th Amendment have been rejected. He agreed with the
spirit of Judge Moran’s statement that “the 861 argument and the
non-ratified Sixteenth Amendment argument share a related lunacy in that, for
differently concocted reasons, neither accomplishes the presumed goal of creating
a Federal income tax on U.S. citizens.”
In addressing the charges related to Banister’s failure
to file his own tax returns, O’Connor found that the Office of Professional
Responsibility had not met its burden of proof. The missing element was evidence
that Mr. Banister had gross income sufficient to trigger a filing obligation
in each of the cited tax years.
O’Connor considered and rejected a number of claims
that Banister raised regarding the fairness of the discipline process and his
opportunity to present his case to the Administrative Law Judge. As a result
of this decision, Banister has been disbarred from representing taxpayers before
the IRS. He may appeal the decision to U.S. District Court.
Links on IRS.gov:
Thurston Bell says Joe Banister is a Scam Artist
Notice of Academic Deficiency
There just seems to be an endless number of people out here
on the internet, who, without credentials, positive accomplishments, or evidence
of prior experience or knowledge of their work on the Internet, and who also
believe that they have some argument "worthy" of hearing by the federal
courts, will ask that YOU send them some money. There are in fact SO MANY of
these people, that I could spend every day for the rest of my life arguing against
and exposing them. This will do nothing but serve the wishes of the Treasury
I have to learn to trust that individuals can be responsible
for themselves, can show prudence, and judge that which is sent to them over
the World Wide Web.
When it comes to IRS lawsuits, I can only share a few points
of certainty regarding the issues of lawsuits.
A: The Federal Courts do NOT want to rule in YOUR favor
B: No Federal Judge wants to be the Federal Judge who collapses
the House of Cards known as the Economic Stabilization Program.
C: The Government and the Judge will use Rule 12(b)(6) to
throw your case out at the drop of a hat. That rule is: Failure to state a
claim for which relief can be granted.
D: The Courts and the Government will look for the weakest
point of your argument and they will rule on that one and ignore the rest
of the issues.
So, if someone is sending an e-mail regarding wanting money
from you to help support a case where there is no specifically damaged plaintiff
and there are multiple arguments, I will not respond to such e-mails.
If you are seriously considering spreading news of or financially
supporting the ideas of such people who have discovered the Internet as a means
of conning people out of money, instead of sending me their e-mail please write
back to them and ask them what their credentials are, what results have they
had, what is their area of expertise and experience, and do they have references
from anyone that you might hold in esteem.
This how the Establishments of Academia control discussions
and discourse. (References are important.) And believe me folks, if someone
out there was doing something that you needed to know about, I would have told
you already. And if they don't have the guts to come to me directly and seek
counsel with people like me who have results, they certainly are NOT worth your
time and effort.
Thurston P. Bell
NITE has VERY strict standards about following the letter
of the Law. The people and organizations listed below use arguments that the
courts have already deemed frivolous, and make all sorts of claims with no results
to show for themselves. While some have truth mixed in with lies, there is just
enough truth to get people tangled into their web. Some of these people are
academic plagiarists who have been using NITE's work product and claiming it
as their own and / or intermingling our argument with frivolous res judicata
patriot arguments. Many of these people / organizations are networked (i.e.
working together). A few of them are SHAM trust salesmen / women. Therefore,
we can truthfully say that from our experience and first hand knowledge, the
following people are "Snake Oil" peddlers and / or CON-men/women who
do not deserve your trust:
American Rights Litigators;
American Tax Consultants;
Bill "William" Conklin;
Christopher H. Hansen;
Christopher M. Hansen;
Dennis MacPhaeddon ;
Ed "Eduardo" Rivera;
Erwin Rommel School of Law;
Freedom Above Fortune;
Freedom Law School;
Free Enterprise Society;
Institute of Global Prosperity;
John B. Kotmair;
Ken "The Hornet" Hunter;
Lamar Hardy, Hawaii;
Larry "Lowell" Becraft;
Law Research Registry;
Right Way Law;
Save-A-Patriot Fellowship (SAPF);
Steve DeLuca (S.T. Fitzgerald, Thomas Luca, other alisases)
Supreme Law Firm;
Taxgate.com (NOT Tax-Gate.com);
Tom Smith (Alleged Doctor);
Treasury Tax Secrets;
Virginia Cropsey a/k/a Little Red Hen
Wallace Institute ( A Disgrace to William Wallace and Clan Wallace);
Wayne C. Bentson
"We The People Foundation"
Paul Sulla, Attorney
People who do not seem to understand have not seen as many people as Mr. Bell
has seen, get hurt. They lose their property, jobs, paychecks, and / or families.
They obviously do not have the discernment to understand how vitally important
this issue is, and how we MUST stay on point or lose.
There is no room for those who claim it is their 1st Amendment
Right for supporting people who are espousing such res judicata arguments. The
courts and the Kotmair case made it clear. Guilt by association is NOW supported
by CASE LAW.
Thurston Bell says those who follow Joe Banister's
advice will be convicted of tax evasion:
From: Al Thompson [mailto:AlThompson@cencal.com]
Sent: Sunday, February 11, 2001 6:23 PM
Subject: Fw: indictments against business owners who follow Banister
Cencal Aviation Products
800 423-6225 International 1 530 275-0667
Fax 530 275-0837
----- Original Message -----
From: Desk of Thurston P. Bell
To: Al Thompson; email@example.com
Sent: Sunday, February 11, 2001 2:49 PM
Subject: indictments against business owners who follow Banister
Dick and Al:
In response to the Feb 10 David Cay Johnston article regarding the threats
of prosecution against business owners for tax evasion, NITE is going
public to advocate for Nick Jesson of NTD Electronics. We should have
great success with Nick's case since he has stuck with my arguments since
the very beginning and has not wavered.
Joe Banister's arguments are doomed to fail in the courts and those who
follow his ideas are doomed to face criminal tax evasion charges. In consideration
of the fact that you have used NITE arguments in the past, I would like
to afford you another opportunity to work with my method. My retainer
cost is $25,000 since I have the only argument that will keep you out
of jail. My only other condition is that you renounce Banister and everyone
else with flawed arguments and stick to my guns.
Feel free to contact me regarding this, but I advise you to move swiftly
because NITE will be moving very soon on this.
to Quatlosers Exhibit