Attorney Couple Who Pleaded Guilty to Tax Fraud Get Probation
Two Philadelphia lawyers who pleaded guilty to tax charges have been sentenced to terms of probation, to federal prosecutors' dismay.
April 05, 2019 at 12:35 PM
3 minute read
Two Philadelphia lawyers who pleaded guilty to tax charges have been sentenced to terms of probation, to federal prosecutors' dismay.
Edward Millstein and Susan Halpern, who are married, pleaded guilty to three counts of tax fraud in November. U.S. District Judge Cynthia Rufe of the Eastern District of Pennsylvania sentenced Millstein to six months' house arrest and five years' probation, while sentencing Halpern to five years' probation and a $5,000 fine. Prosecutors alleged that the money that should have gone to their six-figure tax debt was instead hidden and used to splurge on luxuries.
“We are disappointed in the sentences that were handed down,” U.S. Attorney William McSwain said in a statement. “These are serious crimes that clearly merit jail time, and the court's decision today sends the wrong message to the public.”
Millstein's attorney, William Brennan, said he and his client were appreciative of the court's sentencing.
“We're delighted with the sentence,” Brennan said. “It gives Mr. Millstein the opportunity to maintain his employment and thereby continue to have the ability to satisfy his obligation to the government. I think the court realized there's a lot more to Ted Millstein than this one unfortunate criminal case.”
Halpern's attorney, Jeffrey Miller of Nasuti & Miller, did not immediately respond to a request for comment.
The government alleged Millstein and Halpern owed $444,225 in taxes, for the calendar years 2007 through 2011. When the IRS tried to collect, Millstein hid money in his children's bank accounts to avoid levies. Prosecutors also claim that Millstein lied about obtaining a loan to pay the debt, and didn't tell investigators about a bank account he used to deposit the $300,000 salary paid by his firm each year from 2013 to 2015.
Halpern then spent tens of thousands of dollars on clothing, cosmetics, jewelry, salons, private clubs and trips abroad, while simultaneously failing to pay any of her and her husband's tax debt for 2010 and 2011, prosecutors said.
In November, McSwain chastised the defendants' behavior, saying he expected better from lawyers.
“These defendants intentionally failed to pay taxes, instead choosing to hide their money and spend it on luxuries that they could not afford,” McSwain said in a November statement. “The defendants are both attorneys—they know better. Instead of being law-abiding citizens, they chose to deliberately cheat the system and bankroll their lavish lifestyle. This office will continue to hold tax cheats accountable for their crimes.”
Millstein could have faced a maximum sentence of five years in prison, three years of supervised release and a $100,000 fine, while Halpern was susceptible to a maximum sentence of two years in prison, one year of supervised release and a $100,000 fine.
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