A North Carolina man has been indicted by a federal grand jury on charges relating to tax fraud. Billy D. Floyd, of Monroe, North Carolina, is accused of interfering with the due administration of the internal revenue laws and filing false income tax returns.
According to the indictment (downloads as a pdf), in 2007, Floyd filed amended tax returns claiming that his tax liability had been reduced to zero for the years 2000, 2001 and 2002. Subsequently, in 2009, Floyd filed an amended tax return for the year 1999, also claiming that his tax liability had been reduced to zero. In 2010, Floyd again filed amended tax returns for 1999, 2000, 2001 and 2002 – but this time, he added an additional year (2003). For each of the years, and on each of the returns, he falsely alleged that his tax liability had been reduced to zero.
The amended returns were not accepted as filed and the result was a significant tax liability payable by Floyd. To resolve those liabilities, Floyd submitted fictitious “Surety Bonds” to the Internal Revenue Service (IRS) in varying amounts totaling approximately half a million dollars. Those surety bonds, he claimed, satisfied his outstanding tax liabilities.
A surety bond is a real thing. It’s a promise by one party (sometimes called the surety or guarantor) to pay a certain amount if another party fails to meet an obligation. In the U.S., you’ve probably heard of this kind of arrangement in the criminal context: a bail bond is a kind of surety bond. They are, however, not a legal way to pay your taxes.
Floyd wasn’t content to just file amended returns. Floyd also filed a civil suit (Case 3:10-cv-00066-FDW-DSC) in federal court against the IRS on February 2, 2010, alleging, among other things that the federal income tax is illegal. In July of 2010, that case was dismissed. Floyd appealed but the judgment of the court was upheld.
Floyd didn’t stop there. According to prosecutors, Floyd also attempted to disrupt the public sale of property that the IRS previously seized. How? He told potential buyers that the sale was illegal and that they could not get good title. He also threatened to sue anyone who bought the property – not exactly the most appealing sales tactic.
The prosecutors used the term “attempted to disrupt.” That’s actually not quite right. Floyd was actually successful. On the day in question, August 31, 2010, he did manage to thwart a sale. Not content with his actions to simply break up the sale, he then threatened to follow IRS agents to their cars.
After stopping the sale of his property, Floyd had another idea. A month and a half later, on October 18, 2010, Floyd filed a bogus lien against his property in an effort to prevent a future sale by the IRS.
A federal grand jury sitting in Charlotte, North Carolina, returned an indictment against Floyd on August 16, 2016. If convicted, Floyd faces a statutory maximum sentence of three years in prison for each count listed in the indictment. He also faces a term of supervised release and monetary penalties.
Floyd has recently filed paperwork in his criminal suit claiming that he wished to fire his court-appointed attorney and indicating that he is “desirous of acting as himself in this matter.” To help, he has asked for “Assistance of Counsel.” The judge has denied his motion.
Floyd is scheduled to be arraigned on the matter on September 21, 2016, before Magistrate Judge David Keesler in Charlotte, North Carolina.
