These special-editions Quatloos commemorates those who have made
a name for themselves in their particular business endeavors.
Our 50 Quatloo chip, known as a "Znoo",
commemorates infamous offshore scam artists.
Marc Harris of the Harris Organization.
Once respected as a prodigy and the "boy wonder" of the
offshore world, Marc's reputation faded fast after it was learned
that he was looting his clients' accounts to fund his lavish lifestyle,
and that several directors and investors in the Harris Organization
were known drug traffickers.
The back of the chip is reflective of the "Octopus" arrangement
that Marc created for his clients, which featured a Panamanian Foundation
as the central secret holding entity for a complex structure that
featured client-controlled banks, insurance companies, and mutual
funds. The red-and-blue background is actually the Panamanian flag.
Marc is currently residing in the "Where
Are They Now" file, and believed to be in Nicaragua. He has
since become the poster child for offshore fraud, see http://www.quatloos.com/
|FOR IMMEDIATE RELEASE
WEDNESDAY, MARCH 24, 2004
TDD (202) 514-1888
DEFENDANT TO SERVE 17 YEARS
IN PRISON FOR SMUGGLING FREON AND EVADING TAXES
Profits In Offshore Bank Accounts
WASHINGTON D.C. - Eileen J. O’Connor, Assistant
Attorney General for the Tax Division, Department of Justice; Marcos
D. Jiménez, U.S. Attorney for the Southern District of Florida;
and Nancy Jardini, Chief, IRS Criminal Investigation, announced
today that at the federal courthouse in Ft. Lauderdale, Florida,
U.S. District Judge James I. Cohn sentenced Marc M. Harris to 204
months imprisonment, to be followed by 3 years supervised release,
and a $20,324,560 fine. Mr. Harris was also ordered to pay restitution
to the Internal Revenue Service in the amount of $6,588,949.50.
“Congress imposed excise taxes on the manufacture,
importation, sale and use of chemicals that deplete ozone,”
said Assistant Attorney General Eileen J. O’Connor. “People
who violate those laws are not only evading taxes, but also harming
the environment. They risk criminal prosecution and serious jail
“For decades IRS special agents have aggressively
investigated all forms of excise tax evasion whether the tax is
imposed on fuel, tires or ozone-depleting chemicals,” said
Nancy Jardini, Chief, IRS Criminal Investigation. “Individuals
who illegally sell ozone-depleting refrigerant chemicals such as
Freon to evade the excise taxes, not only defraud the government,
but they also threaten our environment.”
Mr. Harris left Florida for Panama in 1989 and
was returned to the United States after his arrest in Nicaragua
in June 2003. On November 24, 2003, after trial, Mr. Harris was
convicted of conspiring to defraud the Internal Revenue Service
(18 U.S.C. § 371), conspiracy to commit money laundering and
evading excise taxes (26 U.S.C. § 7201).
Congress imposed significant excise taxes to deter
the sale or use of the ozone-depleting refrigerant chemical chlorofluorocarbon,
commonly referred to by the trade name “Freon.” From
1992 through 1994, the years involved in this case, the excise tax
rose from $1.67 per pound to $4.35 per pound of Freon.
Evidence introduced at trial established that
Mr. Harris conspired with Aurelio Vigna, Joseph Vigna and others
to evade federal excise taxes on the sale of Freon to customers
in South Florida. They failed to report and remit those taxes to
the Internal Revenue Service and filed phony paperwork to conceal
domestic sales of illegally imported Freon. To hide the sales proceeds,
Mr. Harris also created and used domestic and foreign shell corporations
and related bank accounts. He laundered more than $8 million in
proceeds generated from the Freon smuggling scheme for Aurelio and
Joseph Vigna by use of a series of wire transfers through Panamanian
corporations and bank accounts. As a result of the scheme, between
January 1993 and June 1994, Mr. Harris evaded approximately $6.2
million in excise taxes and also helped his co-conspirators allegedly
evade additional individual and corporate income taxes on the profits.
Justice Department Tax Division trial attorneys
Shelly L. Goldklang and Gregory E. Tortella prosecuted the case.
Special agents of the Internal Revenue Service, and the United States
Customs Service and the Environmental Protection Agency also provided
assistance that was essential to the successful investigation and
prosecution of the case.
Additional information about the Justice Department’s
Tax Division and its enforcement efforts may be found at www.usdoj.gov/tax.
NEW! -- Marc
Harric v. David Marchant and Commetns
“Offshore asset protection guru” behind
by Eric Jackson, The Panama News
US-born offshore financial hustler Marc Harris, a naturalized Panamanian who had fled to Nicaragua with a lot of other people in pursuit of him and their money, ran into a surprise en route to Nicaraguan citizenship on June 11. He was headed to the immigration office in Managua for a hearing at which he expected to get an extension on his visa. Instead he was formally expelled from the country and handed over to US law enforcement authorities, who immediately flew him to Miami to face money laundering and conspiracy charges. Two days later Federal Magistrate William Turnoff ordered Harris held without bail, opining that “he has little respect for the process of United States courts” and brushing off a defense lawyer’s request for a $150,000 bond secured by a $2 million house.
Harris, who was assigned a public defender, pleaded not guilty to all charges in the 13-count indictment against him. The charges arise from six specific financial transactions that took place in the 1990s, wherein money was shifted among six corporate accounts and five banks --- the Banco Nacional de Panama, TotalBank Panama, Banco Continental Panama, Global Bank Panama and ABN-AMRO Bank --- all allegedly in furtherance of a scheme by one Aurelio Vigna and his son Joseph Vigna to conceal the proceeds from the illegal importation of freon into the United States. Freon, once used in virtually all refrigeration and air conditioning systems, is one of the chloro-fluorocarbon gases that’s banned in the US and most other countries because of the damage it does to the Earth’s ozone layer.
The Vignas were US citizens who fled to Panama, where Aurelio got a job as an executive in Harris’s organization. Harris and the Vignas later had a falling out, with Aurelio Vigna filing a civil suit here alleging that Harris stole some $7 million from him. The Vigna-Harris dispute began to play itself out with Harris thinking that he held the upper hand, as he had inside law enforcement information that the Vignas were about to be arrested and extradited to the United States and thus would not be able to pursue their dispute in the Panamanian courts. But once in US custody, the Vignas became government witnesses in exchange for relative light sentences of 30 months for Aurelio and 18 months for Joseph. The present charges, which could get Harris thrown into prison for 50 years if the book is thrown, are based on information provided to US authorities by the Vignas.
According to the Miami Herald, federal prosecutors hinted that they may have other charges waiting for Harris. At the June 13 bail hearing prosecutor David Buckner accused Harris of helping American citizens evade taxes and said that the US government is investigating the use of Harris’s plane by former Peruvian spymaster Vladimiro Montesinos. Buckner told the magistrate that it’s almost impossible to trace the assets that Harris controls.
Harris, who is facing various privately-brought criminal charges in Panama for fraud or misappropriation of client’s funds, has long counted on the support of Attorney General José Antonio Sossa, who could have but did not ask for travel restrictions that would have impeded the “offshore asset protection” man’s exodus to Nicaragua. On June 18 Sossa’s support for Harris continued in the Panamanian courts, as three attorneys went on trial here for allegedly falsifying documents in order to freeze Harris’s assets in the course of a pay dispute. The principal defendant in that case, former University of Panama law school dean Gilberto Boutin, was Harris’s lawyer and reputed right-hand man and was part of the jailed financier’s organization at the time that the alleged Vigna money laundering operation began. At one point in this long legal battle, some of the defendants were apprehended by foreign bounty hunters contracted by Marc Harris and deputized to make arrests in Panama by José Antonio Sossa.
Marc Harris and the controversies in which he has been involved are legendary, in part due to a carefully created mystique that may include mythological aspects. Two outstanding aspects of the story that are not fictitious, however, are Harris’s political and media manipulations.
There are many allegations that Harris paid bribes for the political protection that he received in Panama, but The Panama News has so far been unable to confirm the specific allegations that we have heard.
Sources including former members of the Harris entourage and people who have served in government say they doubt that Sossa was bribed. One person who had been close to Harris, however, suggests that Harris was privy to embarrassing information about Sossa.
Another Harris tactic to curry political connections --- an ultimately unsuccessful one in one high profile incident --- was simply to flash wealth before impressionable people. Harris’s former sales chief, one Brent Wagman, a fugitive wanted for a $30 million petroleum investment swindle in Texas, took a high profile here. He put his kids in the elite International School of Panama, his wife became active in the Who’s New local welcome wagon club and the couple joined the American Society, whose titular head is the US Ambassador, then Simon Ferro. The Wagmans’ willingness to volunteer to do things, and especially their expensive dress, cars and La Cresta residence, impressed Charlotte Pierce, then president of the American Society, to the extent that Mrs. Wagman ended up as the chairwoman for the annual Easter egg hunt at the US Ambassador’s residence. A report in The Dallas Morning News by Tod Robberson brought that arrangement to an end. Ferro had Mr. Wagman arrested, Mrs. Wagman was uninvited to participate in the event at the ambassador’s residence and Mrs. Pierce faced a lot of grumbling within the American Society for having been used by racketeers. Mr. Wagman, who now resides in a US federal prison, struck a plea bargain that may require him to provide information or testimony against Marc Harris.
Harris used photos of himself with political figures to impress potential clients. In his former office on Avenida Balboa, he prominently displayed a photograph of himself and former US Senator Bob Dole. During the Pérez Balladares administration, a charitable contribution netted Harris a photo with then Education Minister Pablo Thalassinos in the Panamanian dailies.
Harris’s political ties with Panamanian officials continued into the Moscoso administration. For example, according to two sources Harris met with National Police Chief Carlos Barés at a Managua hotel in the fall of 2001.
Then there is the South African political connection. South Africa’s part- time consul in Panama, Ken Darlington, inherited the post from his father, who served during the apartheid era. Darlington also works for Harris, who issued corporate memos specifying in detail the use of the South African consular seal at the offices of The Harris Organisation.
Was it mostly puffery based on chance encounters, insinuations and outright lies, or did Harris have a much wider network of political connections than the known examples cited above? From people who were inside or close to The Harris Organisation with whom The Panama News spoke, the claims are most interesting, but all seem to trace back to the word of Harris himself. For some examples, it is alleged:
that Harris once worked in the office of US Senator Jesse Helms; (The Panama News asked Helms about that by way of email question several years ago, but Helms’s only response was that asking questions by email is a pretty clever idea. The former senator was well known for never answering reporters’ questions.)
that Harris learned the art of money laundering as part of the Iran- Contra operation of the 1980s;
that Harris worked for the ill-fated 1980 GOP presidential campaign of Al Haig; and
that when Harris set up shop in Panama, some of his biggest clients were prominent Republican politicians.
But are these things true, or just Harris inventions designed to create an image for people who are impressed by that sort of thing?
One high- profile GOP connection that’s not a myth, but which preceded the political career and constitutes part of Harris’s media manipulation repertoire, is with the Republican mayor of New York City, Michael Bloomberg.
At one point in the mid-90s a Bloomberg News correspondent worked out of Harris’s office in Panama City. The correspondent, British photographer and journalist Jon Mitchell, also was a contributor to The Panama News. “Bloomberg were aware that I was using [The Harris Organisation’s] office,” Mitchell said, adding that “they would have known about him, as he was a client of theirs for the trading terminal.” It seems a matter of The Harris Organisation using a needy stringer rather than exercising influence with the billionaire at the head of Bloomberg News: “My contact with [The Harris Organisation] was generally brief, when I needed some office space which they let me use,” Mitchell told The Panama News. “They thought --- quite naively --- that this would win them influence, but all I did was quote them in a few articles --- which perhaps swelled their ego a bit.”
But then, being cited on Bloomberg News is a good way for a hustler to transform himself into a guru in the eyes of the gullible. Moreover, if you read old copies of "The Marc M. Harris Analysis" newsletter, you will notice that they all contain ads offering to hire journalists. Media manipulation was always an important aspect of the Harris modus operandi.
The effects of this media manipulation strategy may yet persist --- even after Harris’s arrest, parts of the Panamanian media treat him as some sort of folk hero genius, while others celebrate his fall. This disparity is also nothing new. Marc Harris and the ways that he tried to control the news were at the center of a series of bitter disputes within Panamanian journalism, including within The Panama News.
This reporter and Jon Mitchell had our differences of opinion about Harris at the time, although these were not bitter disagreements. Today, Mitchell calls Harris “certainly a genius of sorts, though morally, perhaps slightly callous.”
More recently, The Panama News has received some criticism for publishing stories by Dutch journalist Okke Ornstein, whose wife used to work for The Harris Organisation and who at one time was a strong defender of Harris and a stern critic of some of the things that this reporter wrote about him.
Another journalist who in the 1990s contributed articles to The Panama News and later worked as Harris’s publicist and was highly critical of this reporter’s take on the offshore financier is Tomás Cabal, who teaches journalism at the University of Panama.
(As editor and publisher of The Panama News I try to maintain ethical standards, but a different opinion about a controversial figure is not, in my opinion, reason to blacklist a journalist.)
The most heated disagreements within The Panama News about Harris arose when Robin Morland was the publisher and Peruvian journalist Guillermo Dávila was working for us, and the Boutin case first began to grab headlines. At that time this reporter collected all Harris promotional material that could be found -- - especially but not exclusively on the Internet --- looked up some of the facts about Harris’s background, and concluded that at the very least Marc Harris was practicing wire fraud and racketeering within the meaning of US law, among other reasons by his numerous sales pitches in which he represented himself as a Certified Public Accountant, although his Florida CPA license had been suspended and wouldn’t be reinstated because he had held himself out as a CPA while suspended and because the one-year term of his suspension would not begin to accrue unless and until he moved back to Florida. Other misrepresentations about the nationality of those working for The Harris Organisation and whether some of the offshore entities Harris created were in fact “banks” bolstered this conclusion.
Meanwhile, Dávila, based upon promotional materials he had obtained from The Harris Organisation, wanted to do a favorable story about Harris. This editor, having seen the draft, opposed the story’s publication.
Also at that time, Harris had been disparaged as little more than a pyramid scheme by Offshore Alert, an investors’ newsletter, after its editor and publisher David Marchant had been asked by an American investor to look into the validity of Harris’s claims. In Panama, La Prensa published similar tales. In each case a key source of information was Gilberto Boutin. Harris, through two of his many companies, filed a multi-million-dollar libel suit against Marchant in a Florida federal district court and pressed criminal charges against four La Prensa journalists for criminal defamation and theft of company documents. These cases were pending and substantial sums were being paid to lawyers to defend against Harris’s attacks.
Adding to the ethical questions in play was the fact that Gilberto Boutin was then a member of La Prensa’s board of directors.
After some heated arguments at The Panama News, Morland decided that the newspaper would not publish anything at all about Marc Harris. The argument recurred several times as events around Harris repeatedly became newsworthy, most notably over the Wagman affair.
Eventually Harris’s suit against Marchant was dismissed with a scathing opinion by a judge who essentially decided that the evidence showed that Harris was a crook and Marchant’s stories about him were valid. Much later, Harris’s charges against La Prensa’s Mónica Palm, Miren Gutiérrez, Rolando Rodríguez and Gustavo Gorriti were also rejected by a Panamanian court.
However, that was but one round in the legal struggles that came La Prensa’s way over Marc Harris, and the Harris issue became one the pieces in play in struggles for control of that newspaper and over the issue of who would be allowed to practice journalism in Panama.
In 1999 the Panamanian INTERPOL office, part of the Judicial Technical Police (PTJ), which is in turn a part of the Public Ministry headed by the Procurador General (which The Panama News translates as "Attorney General"), received requests from US and German authorities for Panamanian help in money laundering investigations against Marc Harris. Sossa flatly prohibited this and, at least partly through the then heads of the local INTERPOL office and the PTJ, the story made it to La Prensa. The Legislative Assembly's Drugs Committee moved to prosecute Sossa over it, and Sossa moved to fire the PTJ chief, Alejandro Moncada. In the end the committee's attempt was blocked by the courts and the Supreme Court, which appoints PTJ chiefs, held that Attorneys General can fire them for cause and that publicizing an ongoing case is adequate cause. Sossa promptly sacked Moncada, and in the meantime filed criminal defamation charges against several La Prensa journalists. Several years later, those charges were thrown out of court by a judge who held that the version that was published was the truth.
The INTERPOL request affair, however, added both legal and journalistic controversy to the Marc Harris story. Apparently the Americans were interested in the dealings of some alleged drug traffickers in Harris's entourage, but the requests were about IRS investigations. Although President Moscoso has pledged to change this, Panamanian law did not and does not allow our legal system to help foreign tax collectors. "Sossa was correct in denying help," former anti-money laundering Financial Analysis Unit director Victoria Figge told The Panama News.
Within La Prensa, there was a largely partisan political struggle for control. The followers of founding publisher Bobby Eisenmann wanting to continue an editorial stance that was generally anti- PRD and not too favorable to the Christian Democrats, who had lost a power struggle shortly after the paper went back into business in the wake of the 1989 US invasion. Shareholders tilting toward the PRD or the Christian Democrats lined up against the Eisenmann faction.
However, there were also allegations that the paper's financial management was shaky and its journalistic quality suspect, and there was a streak of xenophobia directed at two of the main people pushing the Marc Harris stories, investigative unit editor Gustavo Gorriti (a Peruvian) and business editor Miren Gutiérrez (a Spaniard). The gist of the argument was that in its zeal to get Harris, La Prensa had stepped over some conflict of interest lines by basing much of its early reporting on information provided by a member of the paper's board who was, after all, sleazy enough to have been a key Harris operative and facing some serious criminal charges; that Gorriti and Gutiérrez were overpaid and overrated; and that by overplaying a tenuous drug angle to the INTERPOL affair La Prensa had botched the story and run up its legal bills.
Then, in the fall of 2000, Vladimiro Montesinos flew into Panama, stayed awhile and flew away in Marc Harris's plane. Gustavo Gorriti had personal scores to settle with Montesinos from repression back in Peru, the story dominated the headlines for a month or so, and again there was internal criticism of the paper's news judgment.
Meanwhile, Harris was putting up wanted posters with Gorriti's face on them around Panama City. The Pérez Balladares administration moved to cancel Gorriti's work permit and journalists favorable to Harris were applying pressure via the Colegio de Periodistas, the Sindicato de Periodistas and the University of Panama journalism department to ban foreigners from working in the Panamanian media. (Such xenophobia is one reason why this reporter, who is a dual US-Panamanian citizen and thus wouldn't be directly affected by such a ban, is not a member of those organizations.) Also, a steady stream of anti-Gorriti articles, some of them by Tomás Cabal or other pro-Harris reporters, made their way into El Siglo and the late El Universal.
Early in 2001 power shifted on La Prensa's board, Gorriti's work permit wasn't renewed, former PRD Foreign Minister Ricardo Alberto Arias became the paper's publisher and Gutiérrez was gone within a few months. However, there wasn't a complete purge, and stories like Sossa's setbacks in his prosecutions of La Prensa journalists, moves by the National Securities Commission (CNV) and the Banking Superintendent to shut down Harris's operations here, a slew of allegations by Harris clients who said they were cheated and Harris's flight to Nicaragua kept expanding La Prensa's clipping file on Marc Harris.
But meanwhile over at El Panama America, Marc Harris was still being treated as a hero. He still is.
On January 14 and 15, 2001, the paper ran a long interview with Harris by Mario Castro Arenas, proclaiming in its headline that Harris had started out with $5,000 and built a billion-dollar business. The billion dollars under Harris management was one of the specific claims that David Marchant's stories disputed (he said it was more like $40 million) and over which Harris had sued Marchant for libel and lost. The story called Harris "one of the financiers who's best prepared to analyze the new financial regulations pressed for by the economic powers of the FATF," commented on his youthful appearance, displayed a photo of Harris with a portrait of Che Guevara in the background and delved at length into Harris's philosophy of "individual sovereignty." There were no hard questions about the cloud of scandal surrounding Harris. In the first installment, two entire pages of the business section, there was no hint at all of any controversy.
On June 18 of this year, a week after Harris's arrest, El Panama America addressed the subject in its editorial. "Mark Harris is a young accountant who has dedicated himself to administering investments and legacies of clients from around the world with a view to obtain a good return at the least cost of taxes and management," the editorial began. It went on to say that Harris didn't defraud his clients, that Harris's arrest in Nicaragua was illegal and a violation of his human rights, and that the indictment against Harris is a tax case. "Did his clients sink with him?" the daily rhetorically asked. "Surely not. Harris was ingenious and probably carefully wove an impenetrable web.... The war has only begun."
But people who were associated with The Harris Organisation are now being contacted by a team of agents from the Internal Revenue Service and other US law enforcement agencies. The extremely heavy possible sentence for a very narrow and relatively minor part of Harris's criminal activity, plus federal prosecutors' failure to go after some fairly easy-to-prove wire fraud allegations, suggest that as you read these words Harris is under pressure to accept a plea bargain that results in the prosecution of his clients for tax evasion.
The day after the El Panama America editorial La Cronica, a disreputable little tabloid that won't often be noted by The Panama News, reported that its source in Miami said that "tenors Placido Domingo and Luciano Pavarotti have weak voices compared to Marc Harris," who is supposedly singing his heart out to the IRS.
Before drifting into the battleship gray and puke green obscurity of prison and last year's scandal, the Marc Harris story is likely to have a few more repercussions here, especially if the man does turn in his clients. The way the story is played in the Panamanian media will depend on the medium and the reporter, and it's a reasonable bet to figure that those media owned by people in whose banks Harris stashed money, or aligned with politicians who for one reason or another supported Harris, will slant things toward their interests.
But for the mainstream of the business community, the attitude is one of "good riddance" to a stain on Panama's reputation as an international financial center. In the wake of the arrest the CNV and the Banking Superintendent have reminded people that they moved to shut Harris's operation down. Victoria Figge, the first head of the Financial Analysis Unit and before that director of the Colon Free Zone and president of the Panamanian Business Executives Association (APEDE), approves of the arrest. "I think it's good," she said. "It's a pity that it didn't happen when he was in Panama."
Marc Harris Arresting in Nicaragua
and deported the the United States
Offshore financial services provider Marc Harris,
who was first exposed in OffshoreAlert in March, 1998, was arrested
yesterday in Nicaragua and immediately deported to the United States.
Harris was flown from Managua to Miami, Florida, where a criminal
indictment – which is still sealed – was recently filed
against him by the Internal Revenue Service.
As was previously the case with three of his clients
in Panama, Harris was not given an opportunity to challenge the
legality of the action through the local courts. Harris' lawyer,
Roger Guevara Mena, and his second wife, Nubia Gutiérrez
Rivas, accused the authorities of kidnapping the businessman, reported
La Prnesa newspaper, of Nicaragua, today.
OffshoreAlert has previously exposed Harris' involvement
in white-collar crime, including money laundering, banking fraud,
securities fraud, insurance fraud and theft of tens of millions
of dollars of client funds. He moved his operations to Nicaragua
last year from Panama, where had been based for more than ten years,
being allowed to operate due to apparent government corruption.
His group holding company and main operating subsidiaries were incorporated
in the British Virgin Islands and Nevis.
Quatloos! and OffshoreAlert will be publishing
updates on this breaking story from its web-site at www.offshorealert.com.
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Harris Indictment NEW!
Department of Justice
Marcos Daniel Jiménez
United States Attorney for the
Southern District of Florida
FOR IMMEDIATE RELEASE
November 24, 2003
Information Contact Public Affairs
Matthew Dates, Counsel for
Public Affairs, (305) 961-9285
Marjorie M. Selige, Public Affairs Specialist, (305) 961-9048
OFFSHORE TRUST OPERATOR CONVICTED
TAX AND MONEY LAUNDERING SCHEME
Marcos Daniel Jiménez, United States Attorney
for the Southern District of Florida and Brian Wimpling, Special
Agent-in-Charge, Internal Revenue Service, Criminal Investigation,
today announced that a federal jury convicted Marc M. Harris on
tax fraud and money laundering charges.
Marc M. Harris was found guilty of conspiring
to defraud the Internal Revenue Service, in violation of Title 18,
United States Code, Section 371, two counts of evading excise taxes
for 1993 in violation of Title 26, United States Code, Section 7201,
conspiracy to launder money, in violation of Title 18, United States
Code, Section 1956(h), and twelve counts of money laundering, in
violation of Title 18, United States Code, Sections 1956(a)(1)(B)(i)
Harris faces a maximum penalty of 5 years’
imprisonment and a $250,000 fine on the tax-related conspiracy charge
and each tax evasion charge, respectively. He is also subject to
20 years’ imprisonment and a fine of up to $500,000 on each
money laundering count.
During this trial, the jury heard evidence that
the defendant conspired with Aurelio Vigna, Joseph Vigna and others,
to evade federal excise taxes on the sale of ozone-depleting refrigerant
chemicals (commonly referred to by its Dupont trade name, “Freon”)
to customers in South Florida. Congress imposed significant excise
taxes on the sale or use of Freon. During the relevant time, this
excise tax ranged from a low of $1.67 per pound to a high of $4.35
Evidence introduced at trial showed that Harris,
the Vignas and others, engaged in a scheme to evade federal excise
taxes by failing to report and remit those taxes to the Internal
Revenue Service and by filing phony paperwork to conceal domestic
sales of illegally imported Freon. In furtherance of the tax evasion
scheme, the defendant established and utilized domestic and foreign
shell corporations and bank accounts. As a result of the scheme,
the defendant evaded and caused the evasion of approximately $6.2
million in excise taxes between January 1993 and June 1994.
As part of this conspiracy, Harris also assisted
his co-conspirators in evading federal individual and corporate
income taxes on money earned by his co-conspirators and their Florida
Finally, the jury heard evidence that Harris laundered
more than $8 million in proceeds generated from the illegal Freon
smuggling scheme with Aurelio and Joseph Vigna. The defendant laundered
the Vignas’ money through a series of wire transfers through
Panamanian corporations and bank accounts.
Mr. Jiménez commended the investigative
efforts of the Internal Revenue Service as well as the cooperative
efforts of the United States Customs Service and the Environmental
Protection Agency. Trial attorneys Gregory E. Tortilla and Shelly
L. Goldklang, of the Justice Department’s Tax Division prosecuted
to Quatlosers Exhibit