Diversity Is Strength: It`s Also Extended Crime Families, Tax Fraud, And Hung Juries
All this millennium, I`ve been banging on in
VDARE.com about the
links between immigration and
crime families. But even I was surprised when I
ended up on the jury in a trial that so perfectly
exemplified what I`ve been saying that it sounds like I
made it up.
tax fraud trial in downtown Los Angeles was
a VDARE.com column come to life, one thing I did
learn was that you don`t have to be a criminal
mastermind to make millions in white-collar crime.
The scam was incredibly simple. Get licensed as a car
dealer and buy a used car lot. Sell an old car for, say,
$10,000 plus the $825 in sales tax, but send the state
of California only $412.50, pocketing the other $412.50.
Repeat until rich.
Law & Order,
real trials are not crackerjack battles of wits.
This one plodded on for a couple of weeks, but it did
get more amusing when the defense went on the offense.
colorless prosecutors laboriously demonstrated that
charged man had legally registered himself as president
and owner of a used car lot in a
Latino part of the
vast LA megalopolis. Over a three-year period, his
dealership had collected $4 million dollars in sales tax
from customers, but had only sent $2 million on to the
state, thus stealing $2 million,
There was just one little flaw in the accused`s
otherwise perfect plan: lots of other people had tried
to pull this same fast one since California started
collecting sales tax in 1933. So the state government
employs accountants who check up on businesses to make
they are forwarding all the sales tax. The
auditors kept asking the CEO and his bookkeeper, another
Iranian, why, according to the tax records they had sent
the state, all the used cars had been sold for just a
fraction of their
Kelley Blue Book values.
Eventually, the dealership had gone out of business
and now the CEO was in the dock.
So, maybe it wasn`t such a perfect plot, but …
Whose scheme was it, anyway?
The preening defense attorney`s claim was that, well,
sure, his client had signed all sorts of official
documents proclaiming himself to be the owner and chief
executive of the car lot, but he wasn`t really the man
See, the defendant was just fronting for his
brother-in-law, who actually ran the business while the
defendant was merely responsible for deciding what
repairs should be done on the cars and which
repair shops would do it. This hidden partner paid
the defendant $60,000 per year in salary, while he kept
all the profits.
The defense passed around 8" by 10" glossies of the
new house on a golf course in San Clemente that the
brother-in-law had built and decorated for himself and
his wife, the defendant`s sister.
And decorated is the operative word. A year
later, I was reminded of this gaudy Persian palace when
I saw South Park`s
300, the hit movie about the
Battle of Thermopylae. In it, the
invading Persians, dressed in
gold chains, silk shirts, and designer sunglasses,
want to take over South Park and redecorate the
Les Bos bar with the kind of "customized
Gucci accessories which only a Persian would think
Meanwhile, we learned from the defense, the poor
defendant had to make do living in the 2400 square foot
home he had long owned in San Clemente (market value
at the time: seven figures).
The defense put on the stand the defendant`s siblings
to talk about how he was "just a simple man" who,
back in Iran, had
merely graduated from high school. (That, by the
way, would make him above average among
Los Angeles Unified School District students). He
could never come up with or operate such a sophisticated
So why the charade?
Because, we learned from the defense`s own witnesses,
the defendant`s brother-in-law was a
notorious crook, with such a long history of fraud
he wasn`t allowed to work in the
used car business anymore. (Think about
Where, you might ask, is the genius brother-in-law
Well, after about a year and a half of the state
sales tax auditors questioning the nominal CEO, the
hidden partner had fled back to Iran. (Just before
making a run for the border, he took out long-term
leases on five new cars, and then
sold them for cash.) The U.S.,
not surprisingly, doesn`t have an operative
extradition treaty with
Iran, so he`s home free.
The defendant`s sister, the abandoned wife of the
fugitive hidden partner, lamented on the witness stand
how she had to sell the new house and move with her two
children into the house owned by her brother. Her
parents were already living there, so now there are
six people sharing merely 2400 square feet! (And
not on a
golf course either, let me add.)
The defendant`s older brother, a
CPA with an MBA, explained that he had decided
during the used car lot`s first year of operation to
wash his hands of keeping their books.
In the closing arguments, the defense asserted that
the defendant was the real victim. The prosecution
pointed out that he had admitted on the witness stand to
having knowingly signed the legal documents taking
responsibility for the dealership.
Clearly, the arrested man wasn`t the prime mover in
the crime, but equally clearly, he had made the crime
possible by taking legal responsibility for his con man
brother-in-law`s surreptitious return to the used car
If you don`t want to do the time, then don`t sign on
Being on a
jury for a long trial is a strange experience
because you aren`t allowed to talk about the trial while
it`s going on. You finally get into the jury room and
find out that … your fellow jurors just don`t get it.
The vote was 11-1 for acquittal from the beginning
and it stayed that way to the end three days later when
a hung jury was declared. I made sure the defendant
could never say he had been acquitted, but that was all
the satisfaction I could get out of the experience.
Why did 11 jurors vote to acquit?
First, dullness. Many didn`t have the mental
capability to synthesize into a coherent narrative of
cause and effect the pointillist data that emerges over
the protracted course of a trial. White-collar crime
cases, where many of the witnesses are auditors, are
particularly tedious, disjointed, and, by their very
nature, misleading. Nobody else on the jury had figured
out during two weeks of testimony what was going on.
Second, laziness. Nobody else saw it as his or her
duty to figure out what the story was. If the
prosecution didn`t explain it to them well enough
for them to understand it, they weren`t going to think
Third, bias. Several of the jurors
were immigrants themselves, and the most energetic
spokesman for the defendant, a Bulgarian immigrant,
turned out to be a
used car dealer himself! He seemed to take the whole
case rather personally.
Fourth, guilt. Southern California`s economy
increasingly runs on
cash transactions that the taxman
isn`t supposed to hear about. In an outstanding July
20, 2003 article in the Los Angeles Times Magazine,
Undermining American Workers, veteran
newspaperman Fred Dickey recounted:
"In April, I shopped for
a contractor to paint my house trim. I got three bids.
One was for $1,600, about $400 less than the others. The
only condition was that payment be in cash. That wasn`t
remarkable. Is there a Californian alive who doesn`t
know they can pay under the table for cheap immigrant
labor? You pay cash. There are no checks. There is no
"But this bargain didn`t
come from an undocumented worker. It came from an
established businessman with good references. … He
vented: `If I`m going to stay in business, I have to do
what the illegals do. They never pay taxes, on profits
or on their employees` pay. Right there, I`m at a 20%
In Los Angeles, immigrant businessmen from the Middle
East (like the defendant) and from ex-Communist
countries (like the Bulgarian juror) are particularly
inclined toward the gray market. They come from
countries where you can`t trust the government to
enforce contracts fairly. You can only trust your
family. So, you bring your whole family to America and
keep operating just like you did in the Old Country.
The size of the untaxed economy is big and growing.
Dickey wrote in 2003:
"A study last year by the
Economic Roundtable, a Los Angeles research group,
found that the underground sector in Southern California
accounts for 20% or more of the economy, says
economist Dan Flaming, author of the report."
"As the underground
sector surged in the `90s, an unpleasant snowball began
to gather mass. The amount of tax revenues generated by
the economy didn`t keep pace with the population growth
and accompanying rise in demands for government
Having served on this jury, I`m not at all surprised
California is Ground Zero of
subprime disaster that`s taking our country into
recession. To a significant extent, it`s driven by
mortgage fraud. Diversity is strength, as we all
know, but it`s also
failing jury system.
features his daily blog.]